Early payment of preserved pensions
JSP764 – AFPS05 says:
“0313. Early payment of preserved pension with actuarial reduction. A
member who is not entitled to the immediate payment of a pension may apply for
immediate payment of an actuarially reduced pension, even if he is in receipt of
EDP, provided that:
(a) he is a deferred member who has reached the age of 55, or
(b) he is a pension credit member and has reached the age of 60.
The application to AFPAA must be in writing and the sum payable is determined
after consultation with the scheme actuary, who, in the case of a deferred member,
will take into account any inverse commutation which might have been applied
for in accordance with para 0339-0343. The decision becomes binding on the member
only after he has seen and accepted the actuary’s figures.”
This suggests that you could PVR and leave before age 55, then draw an EDP and reduced pension between 55 and 65.
Anyone looked into this or been given examples of how much the preserved pension would be reduced by if you were to draw it 10 years early at age 55? Also what would the effect be on the pension lump sum normally paid at 65?
D4R