Civil Service Classic Pension - which month to retire?

KatieMorag

 I am in the Civil Service Pension Scheme.  I'll be turning 60 in late June and planning to take partial retirement after that date.  For the partial retirement period I will only be taking my Classic pension. 

The pay settlement date for my Department is 1 August each year although typically the pay settlement is agreed a few months later and backdated to 1 August.  I understand that if  I retire after 1 August the pension and lump sum would get recalculated once the pay settlement is agreed. 

 

My question is:  Do you think it would be worth waiting until after 1 August to retire or am I overthinking?  The pay remit has not been published and I do not expect a generous pay rise!  But nevertheless even a 1.5% pay rise would give a higher starting point.

hugheskevi

Overthinking.

Your final salary is based on your last 12 months of pensionable earnings (ie not your salary as at a particular date), except in fairly rare cases where pensionable earnings were higher in cash terms in the past. So even if you retired on August 1st any pay increase would make no difference to your final pensionable earnings.

KatieMorag

That makes perfect sense.  Thank you! 

BoGoF

Plus the earlier you take your pension in the year the more of the CPI increase you get the following April as that is pro-rata for the number of months in payment.