I have a company pension final retirement date is in 13 years?

Question

final salary will be tax free £30,000 plus £80 per week if i took it now & worked part time what lump sum roughly would i get now

Answer 1

You would have to ask your company what discount factor they use to determine the future value.  Once you have that, you can figure the presernt value using the formula

F = P * (1+ i)^t

Where F is the future amount (£30,000)

P is the current amount (how much you would receive now)

I = interest or discount factor

and t = time period

^ means to the power of

Let's say the discount rate is 5% a year for the next 13 years, so, you would just plug the data in and solve -

30,000 = P * (1+.05)^13

30,000 = P *1.05^13

30,000 = P * 1.886

30,000/1.886 = p

15,900 = P

so, at a discount rate of 5%, you would walk away today with £15,900

A higher discount rate means you walk away with less, a lower discount rate means you walk away with more

Answer 2

Who cares? Take it and spend it in the 13 working years. You may not get 13 retirement years.  

Answer 3

If you can take it now, it will be reduced according to the scheme rules.  You will need to ask the scheme this particular question.  Or you could read what information you have on your company pension particulars.  It will probably tell you there what the early retirement reductions are.

It is sometimes an option to take a tax free cash sum.  It is not always on the best terms, and so it is worth taking specialist advice.