It’s important to consider what will happen to your pension account if you decide to change jobs. Click or tap on the options below for further information.
You can leave the Local Government Pension Scheme (LGPS) at any time once you’re a member by giving your employer notice in writing. You might, however, want to take independent financial advice before making the final decision to opt-out. Don’t forget you can, as an alternative, opt for the 50/50 option which allows you to remain in the Scheme, building up valuable pension benefits, but pay half your normal contributions for half your normal pension.
If you opt-out before completing three months’ membership you’ll be treated as never having been a member and your employer will refund any contributions you have paid during that time via your pay.
If you opt-out with three or more months’ membership but less than two years, your benefits will become deferred. You can still take a refund of your contributions (minus any statutory deductions) or transfer out your pension to another scheme.
If you opt-out after two years, you’ll have deferred benefits in the Scheme which can, if you want, be transferred out to another scheme.
If you opt-out you can opt back into the Scheme at any time before the age of 75, provided you’re still eligible to join the Scheme. However, if you opt-out with the right to a deferred benefit you may not be able to join up your benefits should you re-join the LGPS at a later date.
If you opt-out of the LGPS and your employer is required to comply with the automatic- enrolment provisions under the Pensions Act 2008, your employer may automatically enrol you back into the LGPS at certain times. Your employer must let you know if this happens. You would then have the right to opt-out of the LGPS.
The benefit you have built up will be held in the Scheme. These benefits are often known as your deferred benefit.
Your deferred benefit is calculated as follows:
For service from 1 April 2014
1/49th of your pensionable pay for that year (or 1/98 of your pensionable pay if you in the 50/50 section).
For service from 1 April 2008 to 31 March 2014
1/60th of your final pensionable pay for each year (if you have any period of part-time service your final pensionable pay will be the full-time equivalent).
For service before 1 April 2008
1/80th of your final pensionable pay for each year (if you have any period of part-time service your final pensionable pay will be the full-time equivalent). In addition, you’ll receive a tax-free lump sum equal to three times your pension in relation to service prior to 1 April 2008.
Option to increase your lump sum
You may have the option to increase your tax-free lump sum by exchanging some of your pension built up after 1 April 2008.
Visit the Contact details page if you have any questions on retirement or taking your benefits.