Local Government Pension Scheme (LGPS) - Secure Your Retirement

Fund details

Pension awareness week 2024 Agenda What is the LGPS? Protection for you and your family What does it cost? Thinking of paying extra? Working out your pension Thinking of retiring? What is an Annual Benefit Statement? Useful links

Pension awareness week 2024 What is the LGPS? Career average defined benefits Secure guaranteed pension One national scheme Tax efficient pension saving Over 600,000 members

Pension awareness week 2024 What is the LGPS? 11 funds administer the Local Government Pension Scheme locally across Scotland The same LGPS regulations cover them all and are made by SPPA Secure guaranteed pension One national scheme Administering authority details

Pension awareness week 2024 What is the LGPS? One of the largest pension schemes in the UK Over 250,000 people paying into the Scheme Secure guaranteed pension One national scheme Over 200,000 people being paid a pension 160,000 people have a pension they have not yet taken Over 600,000 members

Pension awareness week 2024 What is the LGPS? Your pension builds up each year based on your pensionable pay Your pension is guaranteed by law and not linked to investment markets Secure guaranteed pension One national scheme Both you and your employer contribute towards the cost of your pension Over 600,000 members

Pension awareness week 2024 What is the LGPS? Your pension builds up on a Career Average basis Career average defined benefits Each year 1/49th of your pensionable pay is added to your pension account Secure guaranteed pension One national scheme Your pension at retirement is the amount in your pension account plus increases for the cost of living Over 600,000 members

Pension awareness week 2024 What is the LGPS? The LGPS is a great way to save for retirement Career average defined benefits You receive tax relief on the contributions you pay Secure guaranteed pension One national scheme Tax efficient pension saving You can choose to take a tax-free lump sum when you retire Over 600,000 members

Pension awareness week 2024 Protection for you and your family Ill health retirement Death grant of three times your pay Security for your family

Pension awareness week 2024 What does it cost? Average contribution rate based on five pay bands in the table below Sam earns 30,000 a year, so has a contribution rate of 5.7%. The monthly cost would be 142.50, but with tax relief the net cost is 112.58. Pensionable earnings Contribution rate Up to 27,000 From 27,001 to 33,000 From 33,001 to 45,300 From 45,301 to 60,400 Above 60,401 5.5% 7.25% 8.5% 9.5% 12% Your employer also contributes towards your pension

Pension awareness week 2024 Did you know in times of financial hardship, you can join the 50/50 section of the scheme? Contribution rate 5.5% Yearly pension build up 500 Death in service lump sum Howard s salary 24,500 73,500

Pension awareness week 2024 Did you know in times of financial hardship, you can join the 50/50 section of the scheme? Contribution rate 2.75% Yearly pension build up 250 Death in service lump sum Howard s salary 24,500 73,500

Pension awareness week 2024 Thinking of paying extra? Additional Voluntary Contributions (AVCs) Additional Pension Contributions (APCs) APCs are extra contributions to buy extra annual pension APCs taken directly from your pay Extra pension is paid with your LGPS pension APC calculator AVCs are taken from your pay and transferred to your own personal account with [AVC Provider] Use AVCs to purchase extra annual pension from the LGPS or another provider, or take up to 100% of AVCs as tax-free lump sum www.scotlgpsmember.org/help- and-support/tools-and- calculators/buy-extra-pension- calculator/

Pension awareness week 2024 Additional Pension Contributions (APCs) Additional Voluntary Contributions (AVCs) You decide how much you pay Pay monthly or make a one-off lump sum payment You can change the amount at any time Cost depends on how much extra pension you want to buy, your age and how you spread payments Cost You decide where to invest your money review your choices regularly Increases/decreases in line with inflation AVCs will increase/decrease in line with investment performance Growth No investment opportunity Option to increase survivor s pension or life cover No option to buy additional survivor s pension or benefits Survivors

Pension awareness week 2024 Working out your pension Before 1 April 2009 Final salary 80ths Final salary 1 April 2009 to 31 March 2015 60ths From 49ths or 98ths CARE scheme 1 April 2015

Pension awareness week 2024 The McCloud Remedy

Pension awareness week 2024 Leaving the LGPS Transfer your benefits to another pension arrangement Leave your pension in the LGPS until you choose to take it Combine your pension benefits with a new LGPS pension account Take a refund of contributions

Pension awareness week 2024 Prepare, but be aware... Beware of pension scams Reject unexpected offers Cold calls about pensions are illegal Check who you re dealing with Financial Services Register Financial Conduct Authority: 0800 111 6768 FCA Warning List Don t be rushed or pressured Get impartial information or advice

Pension awareness week 2024 Thinking of retiring? Normal Pension Age Early Late retirement Retirement Between age 55 and Normal Pension Age State Pension age (or 65 if later) No later than age 75 Pension increased for taking it after Normal Pension Age Minimum age 57 from 6 April 2028 No employer consent needed Pension reduced for taking it earlier than normal retirement age No employer consent needed No employer consent needed

Pension awareness week 2024 Early payment Years early Annual pension reduction Automatic lump sum reduction 0% 1.7% 3.3% 4.9% 6.5% 8.1% 9.6% 11.1% 12.6% 14.1% 15.5% Does not apply Does not apply Does not apply Rule of 85 protects benefits built up before 01/04/2008 if you joined LGPS before 01/12/2006 lower reductions apply. Please contact your fund for more details 0 1 2 3 4 5 6 7 8 9 10 11 12 13 0% 5.0% 9.7% 14.0% 18.0% 21.6% 25.0% 28.2% 31.2% 34.0% 36.6% 40.6% 42.9% 45.1% Reduction factors are regularly reviewed

Pension awareness week 2024 Flexible retirement from age 55 Employer policy and consent needed Reduce hours or grade of job Pension benefits reduced if taken earlier than Normal Pension Age Rule of 85 will be taken into account (if you are protected and under age 65) Take some or all of the pension already built up and continue to build up a second pension in the reduced pay/hours post

Pension awareness week 2024 Redundancy / Efficiency of the service Must be 55 or over (or age 50+ if you were in the Scheme on 5 April 2006 and have not had a break in membership). Pension paid immediately and unreduced Based on benefits you have built up to retirement date No option to defer payment, transfer to a different scheme or combine your benefits if you re-join the LGPS Previous Government planned to restrict exit costs in the public sector Rules could change if current Government adopts the policy

Pension awareness week 2024 Ill health retirement any age Your employer determines if you are permanently incapable of discharging efficiently the duties of your job If you are a deferred member, your administering authority makes a decision based on your ability to do the job you were in when you became deferred They get the opinion of an independent doctor before they make their decision If you qualify, your pension is paid immediately, it is not reduced for early payment

Pension awareness week 2024 Ill health retirement any age Based on the opinion of an independent doctor, your employer determines if you are permanently incapable of discharging efficiently the duties of your job. There are two tiers of ill health pension: Tier 1: You are unlikely to be capable of gainful employment before your Normal Pension Age (NPA) Tier 2: You are likely to be able to undertake gainful employment before your NPA Gainful employment is paid employment for 30 hours a week for a year

Pension awareness week 2024 Ill health retirement Deferred member Tier 1 Tier 2 Unlikely to be capable of gainful employment before Normal Pension Age (NPA) Likely to be capable of gainful employment before NPA Unlikely to be capable of gainful employment before NPA Pension enhanced - 25% of tier 1 award Pension paid with no reduction, but not enhanced Pension enhanced based on period to NPA Gainful employment is paid employment for 30 hours a week for a year

Pension awareness week 2024 Thought about taking a lump sum? At retirement, you can turn some of your annual pension into lump sum: 1 annual pension turns into 12 tax-free cash You cannot turn your whole pension into a tax-free lump sum You can generally take up to 25% of the value of your pension as tax-free cash Lump sum calculator www.www.scotlgpsmember.org/ help-and-support/tools-and- calculators/lump-sum-calculator/

Pension awareness week 2024 What is an Annual Benefit Statement (ABS) and what should I do with it? A yearly statement that shows you: The LGPS pension benefits that you have built up at 31 March An estimate of the pension benefits you might receive if you retire at your Normal Pension Age

Pension awareness week 2024 Check that your pay, employment and personal details are correct Review your forecast of where you are likely to be at your Normal Penson Age. Remember, this does not include any other pension benefits you may be entitled to. What should I do with my statement? Use your ABS as a springboard for future retirement planning

Pension awareness week 2024 Questions

Pension awareness week 2024 Useful links National LGPS member website www.scotlgpsmember.org Calculators, videos, FAQs, general information about the scheme Pension fund website www. Pension forms: 50/50 option form, expression of wish www. View your benefit statement, use the benefit projector, update expression of wish details Email: Phone: Write to: Member portal Contact the fund