Case Study

Could you retire early like Christine?

This case study is about Sandra. She came to us a little over 2 years ago to discuss her pension options and to find out if she could retire early. We gave Sandra a full 20 page review of her current pension situation, gave her information on alternative pension plans and ended up allowing her to retire early, pay of her mortgage and pass her pension pot to her children upon death.


Key Facts:

  • Sandra now earns more from her current pension than she would with her standard teachers pension
  • Sandra was able to retire early
  • Higher tax free lumpsum
  • Upon death Sandra’s remaining pension pot is passed to her husband or children

About Sandra:

  • Deputy Head Teacher
  • Age 57
  • 34 Years Service in the Final Salary Scheme
  • Current Salary = £38,821
Sandra was growing tired of her work.  She was fed up with the stress, the constant threat of Ofstead inspections, the long hours and felt teaching no longer offered her job satisfaction.

Sandra’s pension situation before talking to us

  • Starts at age 60
  • £50,995 Tax Free Lump Sum (TFLS)
  • £16,392 index linked pension (PA)
  • Husband would get £4,895 index link (PA) on the even of death

And most importantly – Sandra has no idea she can transfer out.

 

We performed an initial fact find on Sandra’s pensions with our free pension review service, we found that Sandra’s pension pot has a capital value of £390,362 and upon death if there is any of this left the government reclaim it all, none is left for her children.

What we could offer:

£97,590 Tax Free Lump Sum (TFLS)

Sandra decided to split this into the following:

  • She uses £43,000 to pay of their mortgage, saving £1,100PM (£13,200PA)
  • Puts £41,000 into a Bond
  • £12,000 into an emergency fund

 

By saving £13,200 PA from not paying her mortgage it allows her to take early retirement and work part time 2 days per week as a supply teacher.

 

The rest of Sandra’s pension:

Sandra has £292,772 Remaining Capital Value in the Pension Pot, she takes advice from an IFA and decides to invest into a Capital Guranteed Fund.

  • Fast forward 2 years later and the Capital Value of the Pension Pot has grown to £362,000.

Sandra then splits is it up and invests in the following:

  • £217,000 in a Guranteed Account
  • £108,000 in 2 Holiday Appartments
  • £37,000 in the SIPP Bank Account

Now Sandra’s current retirement income is:

  • £2,000 PA from her £41,000 Bond
  • £16,222 PA from her Guranteed Account
  • £19,222 PA total income

Summary:

  • Almost £2000 per year better off.
  • Retired early
  • Her family recieve her remaining pension pot on death


If you would like a 100% free, fast, no obligation pension review, please fill in the form on the right of this page or continue to our free pension review page by clicking here