As long as you meet the minimum age requirement, your employer can allow you to reduce your hours or move to a lower grade and draw all or part of your pension benefits whilst carrying on working.
This sounds like quite a clever way of easing your way into retirement - and you still build up benefits in your 'reduced' job.
There is one drawback though... The benefits you draw when you flexibly retire may be reduced if you draw them before 65, as all the same rules about the 85 test apply to this type of retirement too.
Your employer may waive all or some of any reductions which may apply.
Good points
Could be a great way of easing your way gradually into retirement
Better work/home life balance
Rules don’t spell out how big a change in contract is required
Bad points
If you’re already a tax payer, you will pay tax on every penny of your pension
If you go for a big drop in pay, and your pension is small, you could be worse off financially
Please remember, drawing your benefits in this way is only possible if your employer agrees, in other words it is an employer discretion.
Retiring late
