Phased retirement allows people to reduce working hours gradually. When coming to the end of a long teaching career, the daily exertions of a full timetable can be too much. It becomes sensible to go part-time or to relinquish additional responsibilities. Employers usually understand about this and it often benefits the school too. They must think of the time beyond your employment and who will succeed you in post. If you relinquish responsibility, your institutional memory can be available to those who come next and may need
A common-sense solution
In January 2007, phased retirement was introduced. This scheme allowed members to reduce their earnings at work, by working part-time and reducing responsibility. To make the decision to minimise workload viable, phased retirement will enable members to withdraw part of their pension to boost their income.
The maximum amount you can withdraw is up to 75% of pensionable benefits. The remaining benefits continue to grow as you continue to work and contribute to your reduced salary.
Be aware that any pension that is requested before the Normal Pension Age (NPA) will be subject to an actuarial reduction.
Who can apply for phased retirement?
If you are between 55 and 75, you can apply for phased retirement. You need to make sure your application is with the Teachers’ Pension Scheme three months before you choose to take the salary reduction. The salary reduction must represent at least 20% on the salary you enjoyed in the previous salary year.
If you want to learn more about how phased retirement is calculated, you should talk with an independent financial advisor. You need to consider the short- and long-term effects of taking this retirement option. It might make your life work now but may make your life more financially challenging in the future.
The content in this article was correct on 18th December 2019. You should not rely on this article to make important financial decisions. Teachers Financial Planning offers advice on pensions for teachers and non-teachers. Please use the contact form below to arrange an informal chat with an advisor and see how we can help you.