When we experience a period of disruption and worry, it is not unusual to consider revamping your life. You have likely had an extended time out of the hustle and bustle of a school, and you have become more aware of the toll you are experiencing. Many of us will miss the daily interaction with young people, but others will think it is time to leave the profession. If this is you, it is worth considering the impact on your pension and your future after retirement.
Moving to another career
You may choose to leave teaching and move to another career. It is possible to transfer any benefits you have accrued in the Teachers’ Pension Scheme into a new scheme. If the HMRC recognises the pension scheme, such as the NHS or civil service posts, then you could take your benefits with you.
Just having a short break
Your break will become disqualifying after five years our of service. Therefore, you can choose to leave teaching for a few years and then return, with only a marginal impact on your accrual rates.
If you return to pensionable service after five years, there will be a difference between the index-linked rate of accrual before the break than after the break. Only the service after the break will be index-linked to the higher rate. You also may not return to the final salary arrangement if this was your status before the break in service.
Leaving and not returning
If you leave teaching and you do not transfer to another pension scheme, you will stop accruing pensionable service, and your pension at your Normal Pension Age will be calculated at the levels when you left. You can track this pension at My Pension Online, where it will lay out the benefits you can expect.
The content in this article was correct on 25th April 2020. You should not rely on this article to make important financial decisions. Teachers Financial Planning offers advice on the different types of retirement available with the Teachers’ Pension Scheme. Please use the contact form below to arrange an informal chat with an advisor and see how we can help you.