Life Expectancy.... NRA 65 Now v When Due

[Hawkey99]

Just looking for anybody who has a view on taking NRA 65 early....

I have a heart condition which in the long term is likely to shorten my life expectancy.

So just to give me some idea I've assumes I will pop off at 75...lol..

Im 60 in February.

My combined NRA65 is currently quoted as £5110 (reduced by 25% for taking early) if I take it at 60. If I take my 25% max tax free I'll get £3830

If I take it at 60 and add 3% growth each year I will get a total of £71,000 by the time I am 75.
If I take it when it is due and again assuming 3% growth per year I will get a total of £72,000.

At 65 Im better off taking my NRA 65 early as I'll have 5 years of pension payments totalling £20,300
At 70 Im better off by £8000 (Taking early £44,000, taking at 65 £36,000)
After 75 both of the amount are pretty much the same.
After 75 Im much better off not tasing it early.

So my question is what would you do in this situation?
(Hope I've got the figures right)

Many thanks for any thoughts?

[mags999]

take it and enjoy it you probly wont need as much at 75 anyway

[NorthernBoy]

Take it now and use the money for enjoyment.

I am defo taking my nra65 at 60, no hesitation at all with my decision.

[Woody Guthrie]

It's obviously got to be a personal decision.

Life expectancy is a tough one especially if you have an underlying health issue that may shorten your life, manual workers typically have a shorter life expectancy anyway which most pension experts tend to forget/ignore.

The only thing I would say is obviously if you continue to work there are ongoing tax implications for your projections.

If you just want a free no obligation opinion, if I were leaving the world of work or dropping down to part-time at 60 I would go for it, if I was planning to continue to work full-time probably not.

[Hawkey99]

Already left Royal Mail and not working...

[heapsy]

Normally I'd day leave it until NRA. But if you have a condition that could well shorten your life then I'd think seriously about taking it at 60. If you're wrong about life expectancy and live longer than you thought then you will have drawn it for longer, so it could well even out. Except that is, for the lump sum element. As has also been mentioned, you tend to need less as you get older, so it wont make a massive difference in that case. You'll also get, (hopefully) to draw your state pension which will make all the difference. Are there any benefits you can get regarding disability?

[Schiff]

Already left Royal Mail and not working...

In which case it probably makes sense to take your NRA65 early, presumably to supplement your NRA60 pension.

Depending on your total taxable income from the 2 pensions then, if your aren't fully utilising your personal tax allowance, it could also be worthwhile contributing £3600 each year to a SIPP. You would pay in £2880 and the taxman would add another £720. You could then withdraw the £3600 and be £720 up each year for very little effort.

[Simondavid]

Take it now go to Vegas put it on red !good luck :

[RobertT]

In general I always suggest RM pensions should be taken at NRA, because based on averages, that gives the best return.

According to RMSPS figures, posties life expectancy is on a par with the national average. But in practice nobody is average – everyone is individual!

As someone with elderly parents(late 80's/early 90's), I don't really agree with the idea that you'll need less money as you get older. As in reality you tend to spend more on the basics like utilities, and paying someone to do the jobs you can no longer do yourself.

Ultimately it's a decision only you can make, based on your own situation. You know more about your circumstances than anyone on an anonymous internet forum.

Good luck.

[koolishy67]

As early as you can we never know another variant and pop up