Understanding your pension

How your Age60 and Age65 benefits work
3 min 49 sec

The total pension benefit you’ll get when you retire is made up of three parts:

1) Your final salary pension: the pension you’ve built up to 31 March 2008. It’s based on the number of years and days you worked up to then, and your current pensionable pay.

2) Your Career Salary Defined Benefit (CSDB): the pension you’ve earned based on your service from 1 April 2008 to 31 March 2018. Each year you earned another ‘block’ of this, and the blocks are revalued over time.

3) Your Cash Balance benefit: the lump sum you’ve earned on or after 1 April 2018.

This gives you the total amount of pension benefits you’ll get when you retire. If you’re an active member of the Plan, we’ll show you what these are worth in your benefit illustration each year. You’ll also get a statement from Capita showing the benefits you have in the Royal Mail Statutory Pension Scheme (RMSPS).

Under current legislation, up to 25% (a quarter) of the total value of your benefits can be taken as a tax-free cash sum. For the purpose of this calculation, annual pensions are multiplied by 20, and the Cash Balance fund and other lump sums are taken at face value. The Pensions Service Centre (PSC) pays the benefits due from the RMPP and Capita pays any benefits due from the RMSPS. Although benefits earned to 31 March 2012 are paid from the RMSPS any increase in pre 2012 benefits in excess of statutory increases, attributable to increases in pensionable pay, will be paid by the RMPP. Click here to find out more about your Cash Balance benefit.

For a breakdown of your benefits, take a look at your benefit illustration. Watch the ‘How to find the most important information in benefit illustration’ video to find out more.

If you don’t know which section you’re in, contact the Helpline (contact details are at the bottom of the page); or If you recieve an Annual Benefit Illustration the section is noted on the front page.