Topping up your pension

Experts in the industry believe people in the UK are generally not saving enough towards their retirement. As a member of the Local Government Pension Scheme (LGPS), you already have a head start over many other workers in the UK. But many people are simply unaware of just how much money they will need in retirement to maintain the lifestyle they enjoyed whilst working.

You should start planning for your retirement early so you can make sure you have sufficient income after you finish working.

In 2006 many of the restrictions on the amount of benefit that could be taken from the scheme or the amount of membership that could be accrued were lifted, so even if you joined the scheme at a young age and will have many years of membership at retirement, you can still pay additional contributions to get even more benefit and financial security when you do retire. If you joined the scheme later in life and/or you plan to retire early if you can, then it is probably even more important that you are aware of what you can do to get more from your pension scheme when you eventually finish work.

Up to certain levels, you will get tax relief on anything extra you pay into the scheme, so the cost of topping up your pension may be less than you might think.

As a member of the LGPS you have two ways of increasing your benefits:

One is to buy an actual additional benefit from the pension scheme itself in the form of more retirement pension. This is done by paying Additional Pension Contributions (APCs).

The other is to save money into a saving scheme invested and administered by a third-party provider which will be a private company. This facility is called Additional Voluntary Contributions (AVCs).

SYPA neither recommends nor advises that either method is suitable or appropriate for any individual.