Taking your Pension Early or Late
Taking Your Pension Early or Late
Most of us have an idea of when we would like to retire, however our personal circumstances might dictate whether we can afford to retire early or late.
If you retire at your Normal Pension Age (NPA), you pension benefits will be paid in full. If you choose to retire out with this date, there may be reductions or increases applied.
Taking Early Payment of your Pension
What will happen to my pension payments if I choose to take my pension early?
The earliest you can choose to retire is age 55 (this will increase to age 57 from 6 April 2028).
As you are choosing to take your pension earlier than expected, your pension needs to be stretched and paid over a longer period of time. To ensure it can be paid over the entirety of your retirement, the amount you are paid each year is reduced to cover the additional years.
In simple terms, if you had £10,000 to be paid out over 2 years, you'd get £5,000 per year. But if the same amount is to be paid over 5 years, you'd get £2,000 a year.
The only exception to this is Ill Health Retirement and members who qualify for full Rule of 85 protection.
How much will my pension be reduced by?
The reduction is based on how many years earlier than your Normal Pension Age you retire. If you retire part way through the year, for example, 3.5 years before your Normal Pension Age, the percentages are adjusted accordingly. These reduction rates are set by the Government and are reviewed regularly. You can see the current rates below.
Applicable For Payment Dates On Or After 1st August 2026
| No. of Years Paid Early | Annual Pension Reduction | Lump Sum Reduction |
| 0 | 0% | 0% |
| 1 | 5.2% | 2.0% |
| 2 | 9.9% | 3.9% |
| 3 | 14.3% | 5.8% |
| 4 | 18.4% | 7.6% |
| 5 | 22.2% | 9.4% |
| 6 | 25.7% | 11.2% |
| 7 | 29.0% | 12.9% |
| 8 | 32.0% | 14.7% |
| 9 | 34.9% | 16.3% |
| 10 | 37.5% | 18.0% |
| 11 | 40.0% | N/A |
| 12 | 42.4% | N/A |
| 13 | 44.6% | N/A |
Disclaimer: the reduction rates above are for information purposes only and not a guarantee of entitlement. The rates used by the Fund to calculate your benefits are determined by the date of payment and the factors in place at the time of calculation.
Whilst we take every effort to update the website as soon as we receive new rates from the Government, there may be short periods of time where the website does not display the current rates.
Taking Late Payment of your Pension
For those that left the scheme before 1st April 1998, pension benefits need go into payment at your Normal Pension Age. For those who left the scheme after 1st April 1998 payment of your pension benefits can be delayed but must begin before your 75th birthday.
What will happen to my pension payments if I choose to take my pension late?
As you are choosing to take your pension later than expected, your pension would be increased as it will be paid for a shorter duration. To compensate you for retiring after your Normal Pension Age, the amount you are paid each year is increased. This may result in a higher monthly pension than if you had retired at your Normal Pension Age.
How much will my pension be increased by?
If you retire after your Normal Pension Age, your benefits will be increased as they are being paid later. How much your pension increases by depends on both when you reach your Normal Pension Age, and when you were paying into the pension scheme. If you retire part way through the year, the percentages are adjusted accordingly. The below table illustrates the factors applicable for anyone who reached Normal Pension Age on or after 22nd July 2026. For earlier factors, please get in contact.
Applicable for Members who Reached NPA On Or After 22nd July 2026
| No. of Years Paid Late | Annual Pension Increase |
Lump Sum Increase |
| 1 | 0.0114% | 0.0006% |
| 2 | 0.0124% | 0.0006% |
| 3 | 0.0136% | 0.0006% |
| 4 | 0.0150% | 0.0006% |
| 5 | 0.0166% | 0.0006% |
| 6 | 0.0184% | 0.0006% |
| 7 | 0.0204% | 0.0006% |
| 8 | 0.0221% | 0.0006% |
| 9 | 0.0239% | 0.0006% |
| 10 | 0.0256% | 0.0006% |
Disclaimer: the increase rates above are for information purposes only and not a guarantee of entitlement. The rates used by the Fund to calculate your benefits are determined by the factors in place from your NPA until the date of payment.
Whilst we take every effort to update the website as soon as we receive new rates from the Government, there may be short periods of time where the website does not display the current rates.
What is Normal Pension Age?
Normal Pension Age (NPA) is simply the age you can take your pension benefits in full, without any reductions for early payment. Normal Pension Age differs depending on when you were paying into the Pension Scheme:
- Before 1 April 2015: NPA = 65
- On or After 1 April 2015: NPA = State Pension Age, with a minimum of 65. That means those who have a State Pension Age lower than 65, still have a NPA of 65. As your Normal Pension Age is linked to your State Pension Age, if your State Pension Age changes so too will your Normal Pension Age. You can find out your State Pension Age at www.gov.uk
If you were paying into the Pension Scheme both before and after April 2015, you cannot take payment of the benefits built up under each membership period separately. They must be taken at the same time.
So how much will my pension be?
You can find out exactly how much your pension would be if you were to take it early or late by logging into My Pension+. Use the Deferred Payment calculator and see how taking your pension at different dates changes it's value.
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