When you retire
In a DC Scheme like the BRSS, the value of the benefits you receive at retirement will depend on how much you contribute, how your investments perform and how you decide to take your benefits at retirement.
Use the modeller to work out what your benefits could be when you retire.
Your retirement options
There are several ways you can take your benefits at retirement.
The first 25% of this will be tax-free and the rest is taxed at your marginal rate of Income Tax. This could mean you have to pay a large amount of tax, so make sure you take financial advice if you’re considering this option.
The first 25% of each lump sum you take will be tax-free and the rest is taxed at your marginal rate of Income Tax.
This option provides you with a regular income on terms you choose. You can usually take 25% of your fund as a tax-free lump sum and then use the rest to buy the annuity – a guaranteed income for life. The income you’ll receive will depend on how much an insurance company will provide in exchange for your fund. It’ll also depend on the type of annuity you’d like e.g., whether it increases each year in line with inflation and whether you’d like any dependants’ benefits.
You won’t be able to get an annuity through the BRSS. However, you can contact a financial adviser to help you choose the right insurance provider for you. Get in touch with Hargreaves Lansdown or Aviva to learn more.
You won’t be able to select this option through the BRSS. However, you can transfer your fund to another provider. Contact a financial adviser to help you choose the right provider for you. You can also get in touch with Aviva or Hargreaves Lansdown.
Your retirement income
Remember, your income in retirement will likely come from a range of sources including your Babcock pension. This could include your State Pension and any other benefits from previous or future employers.
Your State Pension will depend on your National Insurance (NI) contribution history.
To check how much State Pension you might receive, visit the Government website.
Will you have enough?
It’s important to think about whether you’ll have enough income in retirement to have the lifestyle you want.
Use the modeller to get an idea of the income you could have from Babcock when you retire.
Think about how much you’ll need in retirement and remember to consider other possible incomes like the State Pension, or benefits from previous employers, when reviewing your possible retirement income. This way you’ll be able to decide whether you’re on track for the retirement you want, or whether you need to save more.
Remember, small changes today could make a big impact on your future, so act now to make sure you’re on track for the retirement you desire.
To change your contributions, email payroll at Payroll.Pensions@babcockinternational.com. You’ll need to include your payroll or NI number and the new contribution you’d like to pay.
