Military Pension

uknick

The value of £8k paid today is £8k today.

The amount paid in 2019 after being inflated since 2004 may well be, as people have estimated, higher. But, the value at today's price is still £8k.


Leaving my pedantry aside , I'm grateful for your question. I also took my public sector pension early and will not get an increase until 2017. Whilst I've been told the increase will be backdated to when I first started drawing it in 2012, I've always been a little sceptical this will actually happen as it is not explicitly stated in the rules I've read. But, as two of us have been told the same thing, it must be true.

System

You can be assured that the military pension does have the increase backdated. I came out in 2005 with my pension and have been receiving my full adjusted pension since 2012.

When you hit the 55 point you should get a letter detailing each years increase from the time that you started drawing it to show you how the value of the pension is arrived at.

freddysmith

Pension % increases from the last 15 years if that is any help


2000 1.2 RPI
2001 3.3 RPI
2002 1.7 RPI
2003 1.7 RPI
2004 2.8 RPI
2005 3.1 RPI
2006 2.7 RPI
2007 3.6 RPI
2008 3.9 RPI
2009 5.0 RPI
2010 0 RPI
2011 3.1 CPI
2012 5.2 CPI
2013 2.2 CPI
2014 2.7 CPI

ger2000

Thanks very much for those figures, with those in mind do you know what my 8K pension would be estimated to be worth at today's rates?

molerat

The age 55 pension is based on the rpi / cpi increases on the uncommuted pension so that figure is needed for the calculation using the increases provided by freddysmith and guesstimates going forward. A ballpark (from mine and a few friends) is around twice the commuted pension after 15 years.

ger2000

molerat, many thanks, appreciated. Seems all those years were worth it.

freddysmith

I didn't commute and my pension increased by 51% at age 55

ger2000

Thanks freddysmith, I commuted the maximum and I have been told that at 55 the amount commuted will return as normal with index link further being added. Is this true?

freddysmith

Yes your pension will be restored plus the 15 years of pension increases (compounded) then index linked using CPI each following year.

molerat

My full pension in 1994 was £5887 fully commuted to £4658 and in 2009 it was uprated to £9052.