Retirement
- Your pension at age 60
- Cash lump sum or dependant’s pension
- Pension increases
- Can I take my pension early?
- Can I take my pension later?
- How are pensions paid?
- Do I get a payslip?
- Does my pension increase in payment?
Your pension at age 60
You are entitled to a pension for life from age 60 at a yearly rate of 1/720th of your 'final salary' for each complete month of Pensionable Service (plus an additional proportion for each additional complete day) up to 30 September 2007. If you have been working part-time, your Pensionable Service will be adjusted to take this into account.
Your pension will be increased by the percentage increase in the Retail Prices Index (subject to a maximum of 5% per year), for the period between the date you left Pensionable Service and age 60 (or, if earlier, the date you take your pension).
Cash lump sum or dependant’s pension
On retirement you may exchange part of your pension for a cash lump sum, which is currently tax-free or, dependant’s pension. XPS Administration will provide details of these options shortly before your retirement.
Can I take my pension early?
If you would like to request to take early retirement, the earliest age you can ask to take your pension from (unless you are retiring on the grounds of incapacity) is age 55.
If you draw your benefits early, your pension will be reduced to take account of the fact that it will be paid to you for longer than it would have been had you waited until age 60. Your cash sum will also be lower as a result.
Early retirement requires the consent of the Trustee.
Can I take my pension later?
If you would like to request to start drawing your benefits later than age 60, your pension would be increased to take account of the fact that it will be paid to you for a shorter period than it would have been had you taken it from age 60. Your cash sum will also be higher as a result.
Late retirement requires the consent of the Trustee. You should contact the Trustee to request this before you reach age 60.
How are pensions paid?
Pensions and children's allowances are paid in advance on or around the 6th of each month. These payments will be made direct to a nominated bank or building society account. Pensions and children's allowances are liable for income tax under PAYE, which we will deduct before payment, as appropriate.
Do I get a pension payslip?
Payslips are issued whenever there is a change to your pension such as in April when pensions are increased (see below) or if your tax code changes.
Does my pension increase in payment?
The Scheme increases pensions and children's allowances on 1 April each year. The increase is based on price inflation over the previous year up to a maximum as explained below.
Any part of a Pension which relates to Pensionable Service before 6 April 2005 will be increased in line with price inflation (by reference to the Retail Prices Index) up to a maximum of 5% a year.
Any part of a Pension which relates to Pensionable Service on and after 6 April 2005 up to 30 September 2007 will be increased in line with price inflation (by reference to the Retail Prices Index) up to a maximum of 2.5% a year.
Some pensions will include a guaranteed minimum pension (GMP). This part of the pension is increased separately in accordance with legislation.
Pensions that have been in payment for less than a year may receive a proportionate increase.