A defined benefit pension is a workplace pension based on your salary and how long you’ve worked for your employer
The amount of pension you’re paid from a defined benefit scheme relates to your earnings when you leave the scheme or retire, and how many years you worked for your employer. For this reason, defined benefit pension schemes are sometimes known as ‘final salary’ or ‘career average’ pension schemes.
Your employer will make contributions to your defined benefit pension scheme and is responsible for making sure there’s enough money at the time you retire to pay you a secure income for life.
A defined benefit pension scheme is separate from the company that sponsors it
Schemes are typically run by trustees who are ultimately responsible for all aspects of the scheme. The day to day management of a scheme is often done by a scheme administrator on behalf of the trustees. Scheme assets – the money held by the scheme – are kept separate from those of the sponsoring employer.
When you can take your pension depends on your pension scheme’s rules
Most defined benefit schemes have a normal pension age – although this will depend on your scheme’s rules, this is typically 65 or your State Pension age.
Many schemes also allow you to start taking your payments earlier than your scheme’s normal pension age. If your scheme allows this, this means you could start taking your pension, at the earliest, from the age of 55. This is expected to rise to age 57 from 6 April 2028. Be aware that if you retire earlier than your scheme’s normal pension age, your pension will be reduced to reflect that it will be paid over a longer period.
If you want to find out more about defined benefit pensions, MoneyHelper has a useful guide.
We don't protect defined contribution schemes
You may have a kind of pension where the money paid in by you or your employer is used to buy investments - such as shares or bonds - by the pension provider. This is known as a defined contribution or ‘money purchase’ pension scheme.
The amount you get when you retire depends on how much was paid in and how well the investments have performed. We don't protect this type of pension scheme.
Other schemes we don’t protect include public sector pension schemes.
Where else to get help with your pension
If you have a scheme we don't protect you can find more information about your pension rights here:
You can also find information and guidance about your state pension, workplace and private pensions and different ways of working later in life on the government's Get To Know Your Pension site.