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Simon Bond had a tumultuous time last year.

After a bereavement, a breakdown and a house move, he said: “I had three of the most stressful life events in a short time.”

The 53-year-old bought his home with his wife in November last year, paying £165,000. Due to an inheritance, they are mortgage-free, and he says what they used to spend on rent they save for house improvements and holidays.

They typically spend two weeks a year in the Lake District.

Mr Bond said: “It’s our favourite place. We go there a lot. We’re very modest people, with maybe a couple of weekends in Whitby, just up the road.”

The library assistant, who had been working 34 hours a week among the shelves, dropped down to 25.5 hours to help him cope.

This meant his income dropped from nearly £21,000 to closer to £16,000.

He needs to make a decision about whether he returns to his original hours by August. Mr Bond would like to stay on reduced hours, which he says has improved his mental health, but he needs to know whether it is feasible.

Mr Bond joked that he would like to retire next year, but he has reconciled himself to the idea that he will be working until his retirement age.

The library assistant said: “I’d like to retire completely next year, or something, to be honest.

“Rationally speaking I can’t imagine being able to before my actual pension age. Sixty or something would be ideal but I just don’t see it. In my mind, I am committed to the pension age.”

He has a final salary pension with the West Yorkshire Pension Fund, and needs to work for the equivalent of three more years before 2038 to qualify for the full state pension.

Mr Bond said he has looked at overpaying into his pension, but that he wasn’t sure he understood enough about it to pay in the right amount.

He asked: “How much of a hit am I going to take if from now until my pension age, I stay part-time?”

Megan Rimmer, chartered financial planner at Quilter Cheviot

Mr Bond faces an important decision about whether to return to his original full-time hours by August or continue with his reduced hours, which have notably improved his mental health.

The consequences of this on his retirement standards could be significant, especially if he does not have his full state pension.

While he jokingly mentioned that he’d like to retire next year, it is important to assess how realistic this is and what impact that will have on his finances.

Mr Bond has a final salary pension with the West Yorkshire Pension Fund and needs to complete the equivalent of three more years of work before 2038 to qualify for the full state pension.

First, it is crucial for him to find out what his current state pension amount would be if he didn’t pay for three more years of qualifying National Insurance Contributions (NICs).

This information will help him understand the financial impact of not getting the required National Insurance credits to get the full state pension.

The state pension is a foundation for retirement planning, so knowing the exact figures can guide better decisions.

Additionally, Mr Bond will not be able to access his Local Government Pension Scheme (LGPS) benefits until at least the age of 55.

If he plans to retire next year, he needs to determine if he has sufficient savings to cover one year of outgoings.

Reviewing all his savings and other assets will help him decide if retiring early is feasible. If he has substantial savings, these could bridge the gap until he can access his pension.

The LGPS scheme provides projections of his pension benefits at various ages (55, 60, 65 and state pension age), assuming his income remains at £19,098.

He should request projections based on a lower income to reflect his current reduced hours. This will allow him to see how continuing part-time work or returning to full-time work affects his pension benefits.

Retiring at 55 might be possible if Mr Bond accepts lower outgoings due to a smaller pension pot.

Given he mentions that they live a modest lifestyle, the figures he is presented with might feel like enough to take an early retirement coupled with a little less than the full state pension.

Alternatively, he might opt to continue working part-time until a later age to ensure a higher pension amount. This decision all rests on his ability to manage his expenses with reduced income.

A thorough evaluation of his wife’s pension benefits, and her employment status is also vital.

If finances are shared, understanding both partner’s financial situations can offer a clearer picture of their collective retirement readiness and Mr Bond’s ability to retire earlier particularly if he is suffering with mental health issues as a direct consequence of working.

Mr Bond will need to think carefully about potentially improving his mental health in the short term by reducing hours and retiring early with reduced income in retirement, which will bring its own challenges.

Lucie Spencer, financial planning director at Evelyn Partners

Mr Bond’s state pension age is 67, so if he continues working until that age, that will be another 14 years of work.

His employer’s pension scheme, however, does allow him to start claiming his pension from the age of 55, although the amount he receives will be lower.

This lower amount gradually reduces as he gets closer to state pension age.

One of the largest downsides of working fewer hours is the impact it will have on his career average earnings, which is the basis his pension is paid to him on.

His income has dropped by 23pc from what he was earning to what he is on presently. 

If we assume his income remained consistent from 2014 up until 2023, continuing to work fewer hours would reduce his career average earnings by £7,089 per annum assuming that he works up until his state pension age.

This equates to a reduction of 29pc over the next 14 years.

He could use the income he is saving from paying off the mortgage to make additional payments to his workplace pension scheme or contribute to a personal pension.

However I fully appreciate that his income is lower at present due to his reduced hours and holidays are important.

Perhaps Mr Bond could consider a halfway house on his weekly working hours, a midway point between 25.5 and 34 hours.

This would reduce the impact on his pension and enable him to continue building up state pension credits at least until he is 55.

At that point, he could then take the reduced pension income offered to him by his scheme of £7,698 and a lump sum of £10,149.

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