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

BobR64

This thread is of interest to me as I have a small USS deferred DB pension built up for a few years in the latter half of the 90s (about 96 to 99).

I was aware that my "normal pension age" was 63.5 but I thought that this was simply the age at which there would be no actuarial reduction to my pension. When trying to figure out what I might get if I retired at slightly after 60 as planned, I was applying reduction factors of three or so years.

Do I understand correctly from this thread that once I am past 60, my normal pension age effectively falls to 60?

[Added since submitting the above:]

It looks like I didn't read the thread carefully enough. I now think the above might only apply if I was not a deferred pensioner at this point. Never mind - it's not as if it's megabucks anyway!

MarlowMallard

BobR64 said:

It looks like I didn't read the thread carefully enough. I now think the above might only apply if I was not a deferred pensioner at this point. Never mind - it's not as if it's megabucks anyway!

It may be worth checking your old contract. My understanding is if you're a deferred member from pre-2011, the NPA will be the lesser of 63.5 or the CPA in your original contract, so if your contract said 60 there will be no ERF after 60, otherwise ERF with respect to 63.5 .  

The other case was if you're still an active member *and* over 60 *and* employer consents to retirement or flexi-retirement, there is no ERF reduction for pre-Oct-2011 benefits; in that case your contract age does not matter.  

Blaubeere

MarlowMallard said:

BobR64 said:

It looks like I didn't read the thread carefully enough. I now think the above might only apply if I was not a deferred pensioner at this point. Never mind - it's not as if it's megabucks anyway!

It may be worth checking your old contract. My understanding is if you're a deferred member from pre-2011, the NPA will be the lesser of 63.5 or the CPA in your original contract, so if your contract said 60 there will be no ERF after 60, otherwise ERF with respect to 63.5 .  

The other case was if you're still an active member *and* over 60 *and* employer consents to retirement or flexi-retirement, there is no ERF reduction for pre-Oct-2011 benefits; in that case your contract age does not matter.  

You are very well informed!

As it happens, I both did some digging into what I signed when I joined my institution back in the 1990s and I heard back from USS in response to my query. 

I do indeed have a contractual pension of 60 for my pre-2011 benefits and thus de facto permission to take that part of my benefits at that age. ERFs would apply before 60 of course but only in relation to that age, 
 the whole discussion about the waiver in relation to 63.5 does not apply. So this is the reason my benefit calculator does not in the end show a significant difference between 59yes 11mo and 60yrs 0mo.

I will ask for a quotation again in the new year, in the mean time I will think about what to say to my employer when.

Thanks to everyone for replies, there is clearly a lot of experience on here.

Blaubeere

JuBlaubeere said:

MarlowMallard said:

BobR64 said:

It looks like I didn't read the thread carefully enough. I now think the above might only apply if I was not a deferred pensioner at this point. Never mind - it's not as if it's megabucks anyway!

It may be worth checking your old contract. My understanding is if you're a deferred member from pre-2011, the NPA will be the lesser of 63.5 or the CPA in your original contract, so if your contract said 60 there will be no ERF after 60, otherwise ERF with respect to 63.5 .  

The other case was if you're still an active member *and* over 60 *and* employer consents to retirement or flexi-retirement, there is no ERF reduction for pre-Oct-2011 benefits; in that case your contract age does not matter.  

You are very well informed!

As it happens, I both did some digging into what I signed when I joined my institution back in the 1990s and I heard back from USS in response to my query. 

I do indeed have a contractual pension of 60 for my pre-2011 benefits and thus de facto permission to take that part of my benefits at that age. ERFs would apply before 60 of course but only in relation to that age, the whole discussion about the waiver in relation to 63.5 does not apply. So this is the reason my benefit calculator does not in the end show a significant difference between 59yes 11mo and 60yrs 0mo.

I will ask for a quotation again in the new year, in the mean time I will think about what to say to my employer when.

Thanks to everyone for replies, there is clearly a lot of experience on here.

Just to add, I am still an active member in active service, so it would be important to double check in the case of deferred benefits. But surely the same should apply 

BobR64

MarlowMallard said:

It may be worth checking your old contract. My understanding is if you're a deferred member from pre-2011, the NPA will be the lesser of 63.5 or the CPA in your original contract, so if your contract said 60 there will be no ERF after 60, otherwise ERF with respect to 63.5 .  

The other case was if you're still an active member *and* over 60 *and* employer consents to retirement or flexi-retirement, there is no ERF reduction for pre-Oct-2011 benefits; in that case your contract age does not matter.  

I dug out the documentation I still have. Unfortunately I don't think I still have my contract for that employer but I have kept everything I received from USS and there is no mention there of anything other than retiring at 65.

It turns out that the only mention I have of an NPA of 63.5 is in an email from USS that replied to a query I made a couple of years ago via their web site. Unfortunately their system did not send me a copy of the question that I asked, and I did not think to take a copy of it before pressing submit, but I presume that I wrote to confirm what my NPA was. Perhaps I had read something about 63.5 that made me wonder whether it applied to me. In any case, their reply says:

I refer to your recent correspondence regarding your normal pension age (NPA).

Your NPA is 63 ½. You are entitled to receive payment of your USS defined benefits (DB), anytime from age 55 however, an actuarial reduction will be applied to your defined benefits for each year you receive payment of these benefits before your NPA.

Blaubeere

I was reminded in writing to USS that the Contractual Pension Age CPA for your pre-2011 benefits would also be on the Final Salary Closure Statement if you have access to the USS site and to the documents section there.