Freedom & Choice

Pension rules changed so that members of certain pension schemes who are over 55, will have more freedom over how they withdraw money from their pension. This is known as Freedom and Choice.

Does it affect Local Government Pension Scheme members?

No, the changes only apply to "defined contribution" schemes. The Local Government Pension Scheme (LGPS) is a "defined benefit" scheme and as such the flexibilities introduced do not impact how you can take your LGPS benefits. However LGPS members can transfer their pension benefits to a defined contribution scheme which offers flexible benefits.


How can I transfer my benefits?

If you want to transfer and the cash equivalent value of all your defined benefits is more than £30,000 then you are legally required to obtain appropriate independent financial advice from either an authorised independent advisor or an appointed representative. You must prove this advice has been sought before a transfer process can begin. If you have less than £30,000 you do not need to obtain advice however it is strongly recommended. You will need to contact us to get a cash equivalent value of your pension.


What do I need to consider before transferring?

The LGPS is one of the best way to plan for retirement and has a range of benefits not available in other schemes:

  • A guaranteed annual pension which is paid for life
  • A pension which increases with the cost of living so as prices go up, so too does your pension
  • Financial Protection including a tax free lump sum and annual pension for loved ones should you pass
  • A pension that doesn't rely on investments so when the economy isn't great, you don't need to worry about your pension going down. 
  • The LGPS is also more flexible than you think; you can take your pension from age 55 and  you have the option to take up to 25% of your pension as a tax free lump sum.

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