Pension Question
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Pension Question
This has probably been asked before. If so I'm sorry.
I'm confused with the literature.
Sqn Ldr retires at 44 yr exit point. Gets immediate pension and lump sum .
Flt Lt aircrew asymmilated on to PA spine this year age 38, wants to leave at 44 (PVR). Immediate pension or no pension until 55 yrs?
I'm confused with the literature.
Sqn Ldr retires at 44 yr exit point. Gets immediate pension and lump sum .
Flt Lt aircrew asymmilated on to PA spine this year age 38, wants to leave at 44 (PVR). Immediate pension or no pension until 55 yrs?
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JJ
My understanding is that once you have done 16 years post age 21 you are eligible for a pension. If you decide to escape prior to your NRD then your pension and gratuity are slightly reduced.
Once upon a time someone told me that the loss of money due to PVR equates to roughly 2 years in the rank so leaving at 44 (23 years)would mean your income is roughly what it would be had you served for 21 years. Not sure if it is an exact science but its seems to be close enough for government work.
Just out of interest when I got promoted at age 37-and-a-bit they gave me an additional exit point of 41 in addition to the normal 44. I'd never heard of that before. Has it happened to anyone else out there or are they just trying to encourage me to go?
My understanding is that once you have done 16 years post age 21 you are eligible for a pension. If you decide to escape prior to your NRD then your pension and gratuity are slightly reduced.
Once upon a time someone told me that the loss of money due to PVR equates to roughly 2 years in the rank so leaving at 44 (23 years)would mean your income is roughly what it would be had you served for 21 years. Not sure if it is an exact science but its seems to be close enough for government work.
Just out of interest when I got promoted at age 37-and-a-bit they gave me an additional exit point of 41 in addition to the normal 44. I'd never heard of that before. Has it happened to anyone else out there or are they just trying to encourage me to go?
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Normal (or what passes for normal I believe) is that on promotion, if less than 3 years to your 38/16 then you will get your 38/16 option deferred until your 3 year seniority point. That's what happened to me.
As I understand it, that is the current sitch - whatever terms of service, if you leave after your 38 point you get your pension straight away. (PA will only get extra PA pension after 5 years as PA). Under the NEW pension scheme soon to come in, and its voluntary to switch or not, if you leave any time before age 55 you get nothing until age 60, if you leave at 55 you get it straight away.
BN
Like a lot of people you are talking b*@locks about the new pension scheme. There are enough details on MoD websites, I suggest you read them.
However, to scotch a few rumours I will attempt to summarise. Yes, under the new scheme you don't get a 'pension' if you leave before 55, because you are not allowed to have one!! However, you get what are called 'Early Departure Payments' from the day you leave, which look exactly like a pension - funny old thing (PROVIDED YOU HAVE SERVED THE MINIMUM TIME TO EARN A PENSION IN THE FIRST PLACE (18 years?), which is actually true of the old system as well. Under the old system if you had not served long enough you only got a 'preserved pension' which you didn't get for years either!) You also get a gratuity, funny old thing, the day you leave. When you get to 55 you start being paid a 'pension' as such, and when you get to 65 you get another gratuity. The amounts under the old and new schemes are not directly comparable, you will have to make your own decisions. The new pension pays system pays you more in the long term, especially if you stay till 55, and live beyond 65. It is possibly less advantageous if you leave early, but you still get a 'form' of pension from day 1 of leaving if you have earned it. It all depends on your individual life circumstances - you need to do your research (10 minutes with a calculator will do!!) or wait till you get the official package!
The new pension is not necessarily a bad deal!!
Like a lot of people you are talking b*@locks about the new pension scheme. There are enough details on MoD websites, I suggest you read them.
However, to scotch a few rumours I will attempt to summarise. Yes, under the new scheme you don't get a 'pension' if you leave before 55, because you are not allowed to have one!! However, you get what are called 'Early Departure Payments' from the day you leave, which look exactly like a pension - funny old thing (PROVIDED YOU HAVE SERVED THE MINIMUM TIME TO EARN A PENSION IN THE FIRST PLACE (18 years?), which is actually true of the old system as well. Under the old system if you had not served long enough you only got a 'preserved pension' which you didn't get for years either!) You also get a gratuity, funny old thing, the day you leave. When you get to 55 you start being paid a 'pension' as such, and when you get to 65 you get another gratuity. The amounts under the old and new schemes are not directly comparable, you will have to make your own decisions. The new pension pays system pays you more in the long term, especially if you stay till 55, and live beyond 65. It is possibly less advantageous if you leave early, but you still get a 'form' of pension from day 1 of leaving if you have earned it. It all depends on your individual life circumstances - you need to do your research (10 minutes with a calculator will do!!) or wait till you get the official package!
The new pension is not necessarily a bad deal!!
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However, you get what are called 'Early Departure Payments' from the day you leave, which look exactly like a pension
Funny old thing, the government exepted the judiciary from the Treasury requirements but not the Armed Forces. Something to do with the judges threatening to resign en masse....
The new pension is a good deal for those who notch up 35 years of service and a poor deal for the majority who leave at the new 18 years point.
JtD
Fine, and for those that leave at 22, 26, 28, 30............year points.??
I have no intention of getting into a p@ssing contest over this. As I said it is down to each individual to do their own research. I was trying to get beyond rumour.
I said that the new pension is not necessarily a bad deal, by implication I also meant it is not necessarily a good deal either!! Opting in or out is a choice some of us, including myself, will have to make in the near future, and everyone in that position needs to do their homework and decide on their own future plans, aspirations, needs etc.
Nuff said!
Fine, and for those that leave at 22, 26, 28, 30............year points.??
I have no intention of getting into a p@ssing contest over this. As I said it is down to each individual to do their own research. I was trying to get beyond rumour.
I said that the new pension is not necessarily a bad deal, by implication I also meant it is not necessarily a good deal either!! Opting in or out is a choice some of us, including myself, will have to make in the near future, and everyone in that position needs to do their homework and decide on their own future plans, aspirations, needs etc.
Nuff said!
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Jess, and others,
I'm surprised that you do not already know the answer to your question. I do accept that you could have been out of area, but the basic info you require has been available to you on the www, even at a paradigm terminal in Basrah, for a long time now.
In the new scheme, your pension will be one 70th of your highest salary (basic pay) in your last 3 years service, multiplied by the number of years you have been in the armed forces. It is not rank-based so there cannot be any tables. You will receive that pension immediately on leaving, plus 3 times that amount as a terminal grant, provided that you are aged 55 at that time, otherwise you will have wait until you are 65. I haven't seen any formulae for the Early Depature Payments, which are expected to be the normal post-service scheme, for those leaving before age 55, but I guess that they will be dependant on pay and time served, but I doubt that it is the 70th x number of years, though I might be wrong.
I'm surprised that you do not already know the answer to your question. I do accept that you could have been out of area, but the basic info you require has been available to you on the www, even at a paradigm terminal in Basrah, for a long time now.
In the new scheme, your pension will be one 70th of your highest salary (basic pay) in your last 3 years service, multiplied by the number of years you have been in the armed forces. It is not rank-based so there cannot be any tables. You will receive that pension immediately on leaving, plus 3 times that amount as a terminal grant, provided that you are aged 55 at that time, otherwise you will have wait until you are 65. I haven't seen any formulae for the Early Depature Payments, which are expected to be the normal post-service scheme, for those leaving before age 55, but I guess that they will be dependant on pay and time served, but I doubt that it is the 70th x number of years, though I might be wrong.
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I just love it!!
Courtesy of PA spine and the new pension scheme this baldrick can now retire to the sun at 55........somedays I love this job
all spelling mistakes are "df" alcohol induced
Courtesy of PA spine and the new pension scheme this baldrick can now retire to the sun at 55........somedays I love this job all spelling mistakes are "df" alcohol induced
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I have heard a trumour that senior army officers are not happy with riff raff aircrew receiving a Lt Cols pension via PES (A) on the new scheme, it probably is true but can they do anything about it?
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Has anyone actually seen figures of the OLD pension scheme applicable to the NEW PAS??
.
I have looked, but either must be blind or cannot find details that relate to my particular circumstance
.
I have looked, but either must be blind or cannot find details that relate to my particular circumstance
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LJR went through all this before I took PAS 12 months ago, seem to remember that I had to ring the pensions people at Innsworth to get the answer. Basically under the old/current scheme as PAS you get the basic Flt Lt (assuming you are, rather than Sqn Ldr) pension which at 55 is approx £22000 and then you are paid a daily supplement from when you joined the PAS (which for most is 38) until your retirement. Supplement was 64.7p per day but not sure what it is now, equates to approx £4000 top up to your pension so total is approx £26k at 55 which at the time was only £2k less than Wg Cdr. Now these figures are 1-2 yrs old but should give you and idea, hope it helps
BG
BG
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There is no confusion over the current/old PES (A) pension its clear as stated. There is confusion over the new scheme. Does your daily PES (A) rate count completely when you calculate your new pension, or is there some kind of get out clause for the beanies. On the face of it the new scheme takes your daily rate (best over the last three years blah blah) and calculates your pension on that...any thoughts?
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"basic Flt Lt (assuming you are, rather than Sqn Ldr) pension which at 55 is approx £22000"
On a different thread it was stated (rightly or wrongly) that your pay is "reduced" to allow for the non contributory pension scheme. Have you any idea what investment would be needed to provide such a pension at age 55? Don't anyone complain about service pay if that is really the case. Just as an example, to provide a pension at age 60 (for a male) of £22000 p.a. with the pension ceasing at death (i.e. nothing for surviving wife) I am lead to believe would need an investment fund of something in the order of £350000 and then that would be a fixed pension without any inflation increases. Any actuaries out there care to cost it at 55 and inflation proofed?
On a different thread it was stated (rightly or wrongly) that your pay is "reduced" to allow for the non contributory pension scheme. Have you any idea what investment would be needed to provide such a pension at age 55? Don't anyone complain about service pay if that is really the case. Just as an example, to provide a pension at age 60 (for a male) of £22000 p.a. with the pension ceasing at death (i.e. nothing for surviving wife) I am lead to believe would need an investment fund of something in the order of £350000 and then that would be a fixed pension without any inflation increases. Any actuaries out there care to cost it at 55 and inflation proofed?
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I've heard half a million from PMA for the average officer...but we damn well deserve it! Those MP swine get far more and the old police pension of half pay after 30 years is also more generous. Every cloud has its silver lining and every rose has its thorn, the grass is always greener etc..
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A Reply to Scotch Bonnet
SB,
A Sqn Ldr colleague of mine on the PA spine, due to leave the RAF in Jun 06 at age 55, has checked out your very question. Yes, the whole of the PA spine salary is counted as pensionable earnings. He is scheduled to receive £30K per annum for life, plus £90K lump sum
A Sqn Ldr colleague of mine on the PA spine, due to leave the RAF in Jun 06 at age 55, has checked out your very question. Yes, the whole of the PA spine salary is counted as pensionable earnings. He is scheduled to receive £30K per annum for life, plus £90K lump sum