You are about to enter a career working with young people, helping them fulfil the potential each one offers. Teaching is a vocation imbued with the benefits of fulfilment and a sense you are making a daily difference.
Teaching is also a professional role, and it has taken years of dedication on your part to win this position. While you are aware of the salary you will earn, you may not be aware of the benefits that come with the Teachers’ Pension Scheme. Here we look at seven key details to know about your pension.
#1 Retirement income
At the start of your career, it is difficult to imagine retirement. However, there will come a time when you want to stop working and enjoy a more relaxing older age. Your pension will provide this income.
#2 Employer contributions
You will pay a contribution each month to your pension, and so will your employer. Your pension is included in a remuneration package along with your salary.
#3 Benefits for your family
Should you die in service, your pension may pay benefits to your spouse, civil partner or dependents.
#4 Your pension continues to grow
If you stay in pensionable service, also known as eligible employment, you will add to your pension
#5 Online tracking
Using My Pension Online (MPO), you can keep track of your pension benefits as you move through your career,
#6 Your pension is revalued annually
As the Teachers’ Pension Scheme is a Defined Benefit Scheme, your annual pension earnings are revalued each year to represent changes in the cost of living. Your pension is not based on investments.
#7 Career Average Arrangement
You are a new starter to the teaching profession, and you will automatically be enrolled in the career average arrangement. Your benefits will grow at 1/57th of your pensionable earnings each month.
Your pension contributions are taken from your salary before tax is taken; therefore, you benefit from tax relief. It is seen as a good value long-term saving scheme that is an added reward for your work as a teacher.
The content in this article was correct on July 31st 2021. You should not rely on this article to make important financial decisions. Teachers Financial Planning offers advice on pensions for teachers and non-teachers. Please use the contact form below to arrange an informal chat with an advisor and see how we can help you.