10.07.2025
Read how changes to our retirement factors coming in October 2025 may affect your retirement.
We use retirement factors to work out how much we need to pay our members depending on how they decide to receive their payments from us – for example, whether they take early or late retirement.
We update our retirement factors every year to reflect any changes in financial conditions. We take into account external influences, such as movements in financial markets and changes to life expectancy.
These retirement factors affect how much you receive based on when and how you choose to retire, such as taking a tax-free cash lump sum and early or late retirement.
Due to recent changes in financial markets, we’ve reviewed our factors and made some necessary changes to our calculations.
These changes will come into effect for anyone retiring on or after 1 October 2025.
Depending on when you retire, the new factors will have a different impact on what you receive.
Members who have fully retired, and members of the Financial Assistance Scheme (FAS) won’t be affected by these changes.
Changes to retirement factors
Normal Pension Age - If you take a tax-free cash lump sum and start your payments at your scheme’s normal pension age, the new factors will result in a smaller lump sum for the same amount of annual compensation given up.
Early Retirement - Taking early retirement before your normal pension age, will result in a lower level of compensation each year than using the current factors.
If you take a lump sum alongside early retirement, the new factors will result in a smaller lump sum and a lower level of compensation each year in most cases.
Late Retirement - If you take late retirement, the new factors will result in a higher level of compensation each year than would be calculated using the current factors in most cases.
If you take a lump sum alongside late retirement, the situation is more complicated, because the new factors are less generous for lump sums, and more generous for late retirement.
What to do next
You’ll need to consider your individual circumstances to decide whether you should retire before or after the new factors come into effect. If you retire before 1 October 2025 you’ll do so based on the current factors.
To help you understand your options, if you’re 55 or over, from 1 July 2025, you can use our online service ‘Quote and Retire’ on our member website to see your potential levels of compensation under the new and existing factors.
This service will help you explore how your cash lump sum and ongoing payments may change if you decide to retire before or after 1 October 2025.
In addition to our online ‘Quote and Retire’ service, you can also send us a secure message or call our member services team to request retirement quotes for dates before and after the change in factors. If you’re unable to use our online facility and want to request a retirement illustration from us, it would be helpful to receive your request by 1 September 2025 to help avoid any delay in setting up your early retirement pension.
You might want to get financial advice to help you decide what to do next. The Financial Conduct Authority (FCA) has a register of authorised financial advisers.
Important considerations
When you compare your options, please bear in mind that the difference in the value of the lump sum is a one-off effect, whereas the difference in ongoing payments will remain for the rest of your life. It’s also important to note that the lump sum is tax-free, whereas your ongoing payments may be subject to tax.
Please also be aware that our separate online tool, the ‘Benefit Modeller’, will continue to use the current factors until 1 October 2025 and should not be used to compare how your benefits could change from this date.
It’s important that information we hold about you is accurate. Figures could change if the information we hold about you is incorrect.
If you’re a member, log in to our member website from 1 July 2025 to use our Quote and Retire tool. Alternatively, you can view some examples to demonstrate what might happen in normal, early, and late retirement scenarios.
If you’re a financial adviser, you may find it helpful to view the new factors.
