USS benefit modeller accuracy around the 'cliff edge' before 60

Blaubeere

I have a query around the USS Benefit Modeller and its accuracy in the Defined Benefit projections before and after age 60. I am looking to retire from my institution around age 60 (Nov 2026) and am using the Modeller to gauge options for leaving either before 60 in summer 2026 (I have concerns around getting the push at the end of 2025-26 in the current climate) or after 60 at the end of our first semester in 2027 (if I can last that long).

I have heard colleagues talk about a big gap in the projection between 59 year 11 months and 60 years and I have also seen a THES piece about this 'cliff edge'. It relates to the waiver on penalties for taking the pre-2011 before 60.

My query is that while I know about this 'cliff edge', often thousands of pounds, I just don't see it in my modeller projections, e.g. 59 and 11 months appears as £38131 annual pension/£114 393 lump sum, while 60 and 0 months appears as £38402 annual pension and £115207 lump sum. 

Does anyone have any experience of this or know why this might be? I know I will need to ask USS but I hope for a sense of what the explanations might be before asking.

My DB penion is made up of pre-2011 Final Salary benefits, added-year AVCs agreed in the 2000s, pre-2016 Final Salary Beneftis and since 2016 Income Builder.

On the one hand, I wonder whether the lack of 'cliff edge' has to do with AVC arrangements and the fact that I will have paid off my DB contributions at age 60. On the other, I wonder if it is a glitch or error in the system.

I did ask for a retirement quote earlier this year for leaving in July 2025 when my University had a voluntary severance scheme open (I took my chances in the end). The quote at that time was almost exactly what the Benefit Modeller had suggested, so I had assumed the modeller was pretty accurate...

THanks for advice

MarlowMallard

This suggests a possible problem with the modeller.  I was playing with the modeller back in 2023, it did show a fairly substantial cliff-edge c 10 percent between age 59y 11m and 60y 01m so it apparently knew about the age-60 cliff-edge.   I then got a quote in early 2024 so I stopped playing with the modeller,  and I did flexi-retire at 60.5 in late 2024, taking 80% of pension.  I never had added-years AVCs, but I do have extra in Inv Builder which will bridge from full retirement to SPA.  

I got no reduction for pre-2011, about 21% ERF reduction post-2011,  and it worked out about 9% reduction overall.   Hope that helps.  

Blaubeere

Thanks for the reply, i am pleased to know it is possible to navigate through all this.

I have summoned the courage to write to USS to ask about this, part of me would like to stick my head in the sand over this, but it would be better for planning to know. I am also finding the last stretch, when I know I want to go, mentally hard, but I gather that's not uncommon!

Barralad77

I could be well wide of the mark, here, but this got a bell ringing….

It would have been somewhere on this forum (where, I’ve long since forgotten) but I ‘think’ I read that the NPA of 60 for pre-2011 contributions doesn’t apply to everyone; my recollection is that it depended on your institution (i.e., it wasn’t applied universally). The reason I remember is because after reading that it wasn’t guaranteed I went and fished out my annual statements from years gone by to check whether mine said ‘60’. But as I say, I could easily be misremembering as it was a couple of years ago now.

And completely agree about the challenge of ‘sticking in’ after you’ve decided it’s time to go. 

MarlowMallard

Barralad77 said:

I could be well wide of the mark, here, but this got a bell ringing….

It would have been somewhere on this forum (where, I’ve long since forgotten) but I ‘think’ I read that the NPA of 60 for pre-2011 contributions doesn’t apply to everyone; my recollection is that it depended on your institution (i.e., it wasn’t applied universally). The reason I remember is because after reading that it wasn’t guaranteed I went and fished out my annual statements from years gone by to check whether mine said ‘60’. But as I say, I could easily be misremembering as it was a couple of years ago now.

And completely agree about the challenge of ‘sticking in’ after you’ve decided it’s time to go. 

I don't think it's NPA 60 for pre-2011, it is a special clause for no ERF after 60, and I don't think it depends on institution.  What it does depend on is (a) being still an active member, and (b) consent to retire by the employer "not to be unreasonably withheld",  and in practice I think it is rare for consent to be withheld. 

Blaubeere

MarlowMallard said:

Barralad77 said:

I could be well wide of the mark, here, but this got a bell ringing….

It would have been somewhere on this forum (where, I’ve long since forgotten) but I ‘think’ I read that the NPA of 60 for pre-2011 contributions doesn’t apply to everyone; my recollection is that it depended on your institution (i.e., it wasn’t applied universally). The reason I remember is because after reading that it wasn’t guaranteed I went and fished out my annual statements from years gone by to check whether mine said ‘60’. But as I say, I could easily be misremembering as it was a couple of years ago now.

And completely agree about the challenge of ‘sticking in’ after you’ve decided it’s time to go. 

I don't think it's NPA 60 for pre-2011, it is a special clause for no ERF after 60, and I don't think it depends on institution.  What it does depend on is (a) being still an active member, and (b) consent to retire by the employer "not to be unreasonably withheld",  and in practice I think it is rare for consent to be withheld. 

That's my understanding too to a point, though I think it may only apply if your pre-2011 benefits relate to being in an institution (like mine) where the Contractual Pension Age for this part of the pension was 60. When you draw the pension at 60, the employer is asked by USS to agree the waiver, which they will do if the retirement is agreed. If you are at an institution where the pension age for the pre-2011 or in the case of deferred benefits, then I there is no waiver as I understand it 

Barralad77

I think the reality is in here, but as this is USS it isn’t as clear as it could be. Looking at a USS document found on site it states that the NPA for contributions between 04/95 and 09/2011 is 63.5 “unless member’s contractual pension age is lower”, the inference being that it might not be lower. It appears to leave open the possibility that someone’s CPA for these years could have been set at 63.5 and not 60. 

MarlowMallard

I think the age in your old institution contract is a red herring here... back pre-2011 was before the age-discrimination laws, and your institution could (and often did) forcibly retire you at CPA if they chose.  The NPA ages for which USS applies an ERF are not necessarily the same, though they may be related.  I think the 63.5 age is a USS-specific thing, i.e. you can take pre-2011 benefits from 63.5 without ERF, even if you're a deferred member or employer does not consent.   

Blaubeere

On reflection that's probably true largely. I imagine that the waiver is not possible if the CPA for the pre-2011 was 65 rather than 60. But whether the CPA was 65 or 60 but there is no waiver (eg deferred pension), the age for no ERFs ought to be 63 1/2

Barralad77

Blaubeere said:

On reflection that's probably true largely. I imagine that the waiver is not possible if the CPA for the pre-2011 was 65 rather than 60. But whether the CPA was 65 or 60 but there is no waiver (eg deferred pension), the age for no ERFs ought to be 63 1/2

That would be consistent with what I was told by USS. Finish after turning 60 and no ERF applied to pre-2011 contributions. Finish before turning 60 and the NPA is deemed to be 63.5 for those contributions (so the relevant ERF is applied). Which would mean that even without the waiver, no ERF is applied after turning 63.5. Luckily I managed to endure the misery and stress just long enough; I turn 60 next week and finish 3 weeks after that. Another 3.5 years would have seen me in either the grave or a secure institution for my own safety.

uss_hamish

For what another data point is worth, the modeller always showed a substantial cliff edge for me, and I've recently obtained a quote from USS for retiring the day after my 60th birthday which is pretty close (enough that I can believe differences in how inflation is handled accounts for the difference) to what the modeller showed. I have 17 years of pre-2011 service.