NHS pension help

[msp2023]

Hello!

I would love some clarity around how an NHS pension works. I've been reading and for the life of me can't seem to figure out a simple way to calculate it.

I joined the NHS in 2017. If for example, I continued working until 2049 (32 years in the NHS) and my salary remained at around 60k, what would I be paid yearly from the NHS pension?

I've been contributing the standard amount per banding.

I hope this is enough information!

Assuming 2049 is when you will reach State Pension Age, I think it will be £35,555 a year. You get 1/54th of your annual salary for every year so 60000 divided by 54 multiplied by 32. In reality it will be more than this because the annual pension is adjusted for inflation each year.

@Earlystartsmakemegrumpy
Thank you!!

2049 would put me at an early retirement at 55 years. I just wanted to see what it would be if I chose to retire early.

Would there be a massive decrease in the yearly salary if retiring this early?

If you retired 13 years before your state pension age, your 2015 pension would be reduced by 47%

@Jubileetime thank you!

I've managed to figure out how it works thanks to you both :)

If you retire early you end up with quite a lot less:

• retiring 13 years before state pension age means you miss 13 years of contributions
• you get a reduced pension (compared to what you have built up) if you take it early to reflect the fact you’ll be receiving it for longer - as previous poster says for retiring at 55 which is 13 years before state pension age by then, you lose 47% of it.

@PosiePerkinPootleFlump thank you!
It makes sense but gosh it's shocking when I actually calculate how much less I would get!

Also another really daft question incoming.... does that yearly pension just continue to get paid until I die? 🧐

Yes, goes up every year and paid till you die. Spouse/partner also gets half pension if you die before them

Firstly, I believe the earliest you can take it will rise in line with NPA so you could only actually take it from 58.

I know you would get less but do the following rough calculations.

Pension at 55
80 - 55 = 25 years x £ (reduced pension)

Pension at 58
80-58 = 22 years x £ ( reduced pension)

Pension at 68
80-68 x 12 years x £(full pension).

That's the old 1995 pension isn't it? The 2015 isn't based on salary

And I don't think you can draw the 2015 until retirement age? The 1995 you could retire at 55

There's a really helpful Facebook group that gives good advice

1995 was final salary, 2015 which applies here is salary average.

I've got a few years in 95 and a few in 2015. I have absolutely no certain idea what I'll get but as long as I can keep going and not retire early it will be more than decent

No, 2015 scheme is still based on salary but it's career average salary not final salary. So you get 1/54 of your annual salary every year.

You can draw early but you get hammered for it

@Earlystartsmakemegrumpy that is because you get less for more years so it evens out.