Want to retire but can't afford to

[Classof76]

Sorry for long post....
I find myself in a situation which is making me feel miserable probably depressed too.
I work for a local authority in a clerical role, I have lost all interest and passion for the role or come to that working full stop, I feel I have had enough.
I am 61 and have worked continually for 45 years except for 6 months mat leave. I am currently full time working a 14 day fortnight on 22K. I worked for private companies who did not always have pension schemes. My current pension is poor as even though I have worked there 20 years the majority of this was part time, due to childcare.
Right now, I cannot afford to work part time as I need the money and this would also affect my pension which is not enough to live on, best case scenario is 6K plus 4K lump sum if I go at Christmas. I also have a private pension pot of 40K.
I did not anticipate my pension being my only income as I had inherited my parent’s house and that was to be my income, however after getting divorced I now live there and I was shafted by my ex-husband for want of a better word, I didn’t even (stupidly) opt for a pension sharing scheme, he also took half my inherited property capital.
I have remarried, my DH works FT and is the same age, he only has the state pension at 67 and a private pension of 30K.
I feel so trapped as I also have an auto immune condition so I cannot do anything physical as I tire out and so working in this role is good for that but not for my MH. I really hate it as all my friends have been able to retire and I don’t have anything in common with the younger graduates I work with.
I applied for redundancy a year ago, and they refused, (said it was down to money but it wasn’t that, just they wanted my skills) I was hoping this would come around again but nothing is planned for the future.
I am considering part time topping up with my private pot to see me through anyone have any other ideas?

Right now you hate your job so the idea of working is just awful but have you considered planning to work way past your retirement age but only a little. To boost your pension and to keep you doing something but only a few hours a week. It could be actually a nice thing to do and not stressful. Right now you are planning to work full time then stop. Maybe if you plan differently you could do something part time now with the intention of doing it longer

They do, however it's complex and your manager has to backfill your hours and there's a cost and it's not a given. Also the pension is reduced.
I'm going to have to think about this one, I don't even know if they'd agree I know they've refused a lot.
Also I don't have a current manager, she's off sick and unlikely to return.

@Winter2020

That bit of your pension statement shows you either opted to reduce your annual pension in order to get a larger lump sum - or they are quoting what you might want to do when you retire?

Although I too would query the £6k pension Plus 4k lump sum but that may be what the OP has already worked out. Lots of things you can do when it comes to making decisions on annual pension versus lump sum amounts. My OH and I both took slightly bigger lump sums, to pay off a couple of things so that our finances were ok until I got my State Pension ( I retired first)

They do a Flexi retirement but it's not straightforward as I've said to another poster.
It's a case of if I take this amount it's forever and could I survive on it plus 9k state pension long term?

Or...am I better going part time, leaving LA pension and using my private pot of 40k to top my wage up?
I suppose my LA at 6k plus state of 9k would give me 15k pension, not great but hey ho!

@Classof76 - I understand it is not straightforward - we had to do it, and I had worked for a while on Public Pensions so I understood exactly what was what and the calculations were difficult even for me. But you might be surprised that a small drop in your annual pension produces a bigger lump sum than you think.

Sorry if it's no use to you, but it's my best suggestion. I hope something works out for you - and as others have said, please go sick when you need to. You may have a better chance of getting an early retirement package if they come round again if they can see that you are struggling. All the Best

@Classof76 Personally I wouldn't use up your £40k pension pot unless you have absolutely no choice - but only you know what will be best for you

When you are considering taking a larger lump sum, however useful at the time, bear in mind that your pension will be cpi linked. I took a bigger lump sum and a very small pension ..... wish I had decided on the bigger pension.... it would have been very handy right now with the rising cost of living.

With the numbers you have given (and my maths so don't take my word for it) it looks like you would have to live/claim for 13 years plus to be better off taking the larger annual pension so if you retired at 67 living until 80 before you are better off.

Some of my colleagues used a lump to pay off a mortgage so they also saved on the interest they would have needed to pay.

If you reduce your hours and supplement with your private pension your Local Authority pension will continue to grow beyond what you would get if you went this year. Not growing as fast as staying full time but still growing.

If you do ask for flexible retirement do it formally, in writing cc Human Resources etc and document and include evidence of your health issues and say reducing your hours to help you "stay well" "manage your health needs" etc.

Faced with someone that could potentially end up long term sick if they are full time they would be daft to refuse a reduction in hours.

Up and move to a cheaper country to retire?

https://www.lgpsmember.org/your-pension/planning/taking-your-pension/

It seems that the lump sum is less % reduced for taking it early than the non lump sum part. It's probably to do with the scheme saving money on the inflationary rise you would get each year with the annual pension as referred to by a previous poster.

So as I see it your issues are you had bad advice when you divorced, which can’t do anything about now, you’ve worked at not much more than minimum wage jobs and so not been able to save more.

You can’t go back in time but you can do something to earn more now. £22k for someone with 45 years work experience is crap. School leavers get paid that and I’m sure you have so much on them.

I'm the same op, only 55 but have been working since 18 in stressful jobs my whole life and just had enough ! Trying to make it to 60 but it's hard. A couple of my friends recently retired in their mid 50's with fantastic pensions and I'll openly admit I'm resentful.

I know, the thought of another 6 years is depressing

I have equity release on my home. It is not all bad. My suggestion might be to raise a pensioner mortgage on your property. Take a lump sum to help you until you reach retirement age. The Cumberland Building Society are very good for these.

Nobody here can redo the past to have ensured you have a decent pension - you are where you are.

The positives are that you will get a state pension, and you own a property. A lot of people in the generations behind you can’t afford to get on the ladder and there will be no state pension left when they get to that age.

Your pension is small, so you will need to make difficult choices…or continue working (but it sounds like you don’t want to keep doing that).

I don’t know where you live in the UK, but if it were me I’d move somewhere cheaper. Either downsizing massively, or moving into an over 55s accommodation.

yes - you want to keep your house as inheritance, but bluntly it’s the only asset you have so you need it to stop work.
You might end up with dementia in a care home and your house is used to pay care fees in which case your daughter won’t be getting the house anyway.

@hon There will always be a state pension. Few people amass enough wealth to support themselves between not being able to work and dying. With modern medicine this time is increasing. Unless it is just called sick pay? But it will exist. The state pension has existed for over a 100 years and was recently increased. Older pensioners get a smaller pension. Before the state pension families had to support elderly people or they went in the workhouse - still state paid provision.

And if you only have the state pension you will be better off selling your house and living off the proceeds, and then moving into an over 55 flat and getting the state to pay for you. The poorest pensioners are those who own their own home and only have the state pension as they can't pay for proper maintenance.

@AskMeMore we will see in forty years - but the current demographics of the UK, falling birth rate etc…who will be paying for this triple locked state pension that is not means tested? We don’t have enough at working age paying tax to keep it sustainable! I for one (early thirties) am planning as if I won’t receive it.

https://www.thisismoney.co.uk/money/pensions/article-11961943/amp/So-state-pensions.html

So what happens to older people given few can amass enough earnings?
Although the next generation are predicted to be wealthy as pensioners as they inherit wealth.

And yes the pension age will increase. As medicine improves people's health will improve so they can keep working and their life expectancy will also increase. So of course state pension age will increase. That is a long way from no state pension.

They work to state pension age and then live off the SP. If they are not entitled to full SP and have no other savings or income, they may be entitled to pension credit.

Pension credit has been abolished. It only applies to older pensioners. People retiring now get a state pension set at the pension credit level. The state pension has recently increased. Older pensioners get much less.

@AskMeMore we are looking at a car crash - because younger generations home ownership is dwindling so they won’t even have their homes to sell to keep them going.

universal non-means tested triple locked pension (even with a rise in pension age) - is simply unaffordable. Try and find any news report or research which says otherwise. If we as a country can’t afford it, it won’t continue. It’s simple.

Life expectancy isn’t increasing - it’s decreasing…our nation is poor, unfit, obese https://www.kingsfund.org.uk/publications/whats-happening-life-expectancy-england

the next generation are NOT predicted to be as wealthy…they are falling behind on home ownership, debt …almost every measure https://www.businessinsider.com/millennials-versus-boomers-wealth-gap-2020-10?amp

yes some may get an inheritance but that’s after inheritance tax, and the fact that some will need that money to pay for nursing home fees leaving no inheritance left. And that’s not including the large proportion whose parents aren’t rich (like the OP)