Example of how my benefits are worked out if I work part time

Example

Sue works part time and earns £10,000 a year, as at April 2014, her full time equivalent pay is £20,000.

She has worked for 20 years before 1 April 2014 and will work for another 5 years before she retires.

Sue has always worked half the hours of a full time colleague and so her membership used to work out her retirement benefits will be 7 years before 1 April 2008 and 3 years after 1 April 2008.

For membership from 1 April 2014:

Year

Pensionable pay

Pension earned

Brought forward

Revalued value

2014/15

£10,000

£204.08

£206.53

 

2015/16

£10,200

£208.16

£206.53

£414.28

2016/17

£10,404

£212.33

£414.28

£642.27

2017/18

£10,612

£216.57

£642.27

£880.32

2018/19

£10,824

£220.90

£880.32

£1,128.75

The above is based on actual revaluation for 2014/15 and 2015/16 financial years. It is assumed that her pay will increase each year by 2% throughout and cost of living will rise from 2016/17 by 2.5% each year

So the pension for the period from 1 April 2014 to 1 April 2019 is £1,128.75 a year

For the membership before 1 April 2014 her pension will be:

For the membership between 1 April 2008 and 31 March 2014

Pension = final pay (full time equivalent) x membership (proportionate to part time hours) x 1/60

Pension = £21,648 x 3 ÷ 60 = £1,082.40 a year

For the membership before 1 April 2008

Pension = final pay (full time equivalent) x membership (proportionate to part time hours) x 1/80

Pension = £21,648 (full time equivalent) x 7 ÷ 80 = £1,894.20 a year

Lump sum = yearly pension x 3

Lump sum = £18974.20 x 3 = £5,682.60

So Sue's total benefit will be:

Pension = £4,105.35 a year (£1,128.75 + £1,894.20 + £1,082.40)

Lump sum = £5,682.60

Sue can also choose to give up some of her pension for an even bigger lump sum.

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