You should apply for your pension four to six months prior to your date of retirement or your sixtieth birthday. Normally you would agree your retirement date with your employer; you will probably choose the end of a half-term, term, semester or the academic year.

You need to obtain the correct form and complete it.

• Premature retirement: form 14PR
This is available from your employer; your employer completes their part of the form, and then sends it to you to complete and return to Teachers' Pensions.

• Age retirement: form 14A
This is available from your employer, unless you have left pensionable employment less than three years ago, when it is available from Teachers' Pensions; you complete your part of the form, and then return it to your employer/former employer who completes and returns it to Teachers' Pensions.

• Form 14OS: to be used if you left pensionable employment more than three years ago
This is available from Teachers' Pensions - you complete the form and return it to them.

• Actuarially reduced benefits: form 14ARB
This is available from Teachers' Pensions, who advise that you make enquiries at least nine months before you wish to go, as the employer can object to the timing of your leaving for up to six months. If you are still in pensionable employment, or have left employment under three years ago, the form is available from your employer or former employer. You complete your part and return it to your employer/former employer who completes and returns it to Teachers' Pensions. If you have left pensionable employment longer than three years before you come to claim your retirement, you complete the form and return it to Teachers' Pensions.

WORKING ON A PENSION

You may want to continue lecturing part-time after you retire (you can find information on this on the Teachers' Pensions website). However, if you retire with an ill-health pension you should consider the matter carefully and take appropriate professional advice before starting to teach again. If your pension was awarded on or after 1 April 1997, any teaching in a school or college will automatically lead to the loss of your ill-health pension. Work of any kind could lead to a review of your incapacity from teaching.

In most cases, if you return to teaching after retiring, you will now be able to contribute further to the Teachers' Pension Scheme. However, unless you retired with an actuarially reduced pension, there are restrictions on the amount you can earn. The sum of your pension and your part-time earnings from teaching must not come to more than your 'salary of reference' in any financial year: this is the final salary on which your pension was based, increased annually in line with inflation - Teachers' Pensions can provide individual advice on this figure, or telephone 0845 6066166.

STATE RETIREMENT PENSION AND BENEFITS

The state pension is currently paid to women at 60 (if they paid their full contributions and did not opt for the married women's stamp), and men at 65 (the state pension age will move to 65 for both men and women from 6 April 2020; the change from 60 to 65 for women will be introduced gradually from 2010 to 2020). The state pension can be drawn even if you are still working; it will not be affected by any earnings you may have, but it will count as part of your taxable income. Or you can opt to defer taking your state pension, or if you are already in receipt of it decide to stop claiming it for a period, which would earn you an increased state pension when you do claim it. You can only do this for a maximum of five years. You earn 1% for every five weeks you defer or 10.4 % for a year.

Example – extra weekly pension

Anne decides to put off claiming her state pension for five years. When she comes to take up her pension, the weekly rate she would have been entitled to, if she had not put off claiming, would have been £105. As she put off claiming for five years and chose extra state pension, the amount of state pension she will get every week will be £159.60.

If you defer your state pension for over one year then you can opt to take the missed payments with the interest as a lump sum.

Example – lump sum
(based on illustrative rate of return of 6.75%)

Ahmed’s weekly state pension is worth £105. When he reaches state pension age he decides to put off claiming his state pension for five years. When he claims his pension, if he chooses a lump sum, he will get a lump sum of around £32,306 (before tax) as well as his normal weekly state pension entitlement.

Further details available from the Department of Work & Pensions website.

You can obtain an estimate of your benefits by completing form BR19, available from local benefits offices; information is also available from the Department for Work and Pensions Helpline on 0845 7 31 32 33.

Currently, there is a two-tier state pension system. The first tier is the basic state pension, now £77.45 a week for a single person. It is only increased in line with prices, so has been falling in relation to average earnings for years. It is now at more or less the same level, compared to earnings, as it was when it was introduced in 1948.

There are no plans to change this. However, if one adds the lump sum winter fuel payment (now £200 for a single person or couple over 60) to the weekly pension, increases since the change of government have more than beaten price inflation.

The second tier of state pension was the state earnings related pension (SERPs). This was replaced with the state second pension (S2P) in April 2002. S2P pension will build up twice as fast as at present on earnings below £9,500, but only half as fast on earnings between £9,500 and £21,600. (These figures will be increased each year). Mathematically, this is calculated so that no one will build up less under S2P than under SERPs, while the lowest paid will get substantially more. Anyone earning less than £9,500, and anyone away from work because of long term sickness, caring for an invalid, or caring for a child under six, will be credited as if they are earning £9,500.

However, people who belong to the teachers' pension scheme, and most other occupational pension schemes, were not SERPs and will not be in S2P either. This is because they are contracted-out; that means that they pay lower national insurance contributions and expect to receive an equal or better pension from their occupational scheme. (They still receive the basic state pension, though). Contracting-out will go on, with the rebates on national insurance being even more generous than they are at present.

Alongside S2P there is stakeholder pensions (SPs). These are aimed at people who do not have an occupational scheme that they can join, and for whom personal pensions are too expensive. If you are earning less than £30,000 you can contribute to these pensions alongside your teachers pension.

In addition, there is pension credit which is a means tested benefit that is available. It has two elements the ‘guarantee credit’ which replaced income support for people over 60 years of age, and the ‘saving credit’ for people over 65 which is intended to provide extra money for people who have saved for retirement.

STEPPING DOWN ARRANGEMENTS

If you want to 'step down' to work on a lower salary and with fewer responsibilities before you retire there are two possible 'stepping down' arrangements (you can find information on this on the Teachers' Pensions website). These require the co-operation of the employer in certifying that the new post involves a reduction in responsibility and full-time equivalent salary; both have time limits. We advise you to negotiate stepping down arrangements for your pension before you agree to the reduction in salary:
• your pension can be calculated in two parts - the first based on the salary up to the time of the reduction in responsibility (increased in line with inflation) and the second based on the final salary at the time of retirement;
• or, if you are over 50, your contributions and pension may be calculated on your former higher salary - you may be able to persuade your employer to pay the extra contributions as this is permitted under the regulations.

Alternatively, you may choose to change to part-time teaching. If you are able to negotiate a post which is based on a fraction of your former salary - such as a change to half time on half salary - the stepping down arrangements will not apply. If you change to a post on a lower full-time equivalent salary you will need to protect your pension through the stepping down arrangement.

Pension benefits are currently limited to two-thirds of 'final remuneration', including an allowance for the lump sum. This can adversely affect lecturers who have accumulated substantial reckonable service and an AVC fund. If you are changing from full-time to part-time you should take account of the possibility of breaching this limit.

• If you are within 10 years of retirement you are unlikely to be affected: your final remuneration can be based on the yearly average of the total taxable pay in any three years ending within ten years of retirement.

• If you are more than 10 years away from retirement when you change to part-time work, it is unlikely that you will accumulate a pension equal to more than two-thirds of your salary - but you should check this out. If you are likely to be affected by this rule you may wish to reduce your AVC or past added years contributions or ensure that you retire within ten years of your change to part-time. NATFHE strongly advises you to check that your records are correct by obtaining an estimate of your future benefits from Teachers' Pensions, on 0845 6066166. You will need to provide your national insurance number or your teacher's reference number.

CHECKLISTS

Financial checklist
• Check your Teachers' Pensions records. Make sure they are accurate. Remember to nominate (or to change your nomination of) someone to receive the death benefit after you die, unless it is going to a surviving spouse.
• Check how much pension you will need and how well you have provided for any dependants. You may need to adjust your provision through past added years, AVCs or a stakeholder scheme. The rules for widow(er)'s pensions are complex, and members are sometimes disappointed when they obtain this information - Teachers' Pensions can provide an estimate of the pension payable in the event of your death.
• Check you are not overfunded for inland revenue purposes - this might be the case if you will retire with close to 40 years in the pension scheme and have AVCs or other entitlement. If in doubt, ask the Prudential or Teachers' Pensions to check. You are allowed a pension equal to 2/3rds your final salary, but 1/12th of the lump sum is added to the pension for this calculation. The definition of final salary is quite complex so you may need advice.
• Check your state pension entitlement. Get form BR19 from your local benefits office or phone 0845 7 31 32 33.

Retirement checklist
• Claim your pension from Teachers' Pensions - try to apply at least six months in advance of the date you intend to retire. You need to complete form 14A, available from your employer. You can check your entitlement and obtain information on related matters from Teachers' Pensions, 0845 6066166 link to www.teacherspensions.co.uk
• Remember - this is your last chance to purchase past added years or to allocate your pension.
• Do you want to convert your AVC (additional voluntary contribution) fund to an annuity? You don't need to do this immediately - you can do it at any time up to the age of 75 (except in Northern Ireland where the scheme has not yet changed). And you don't have to buy an annuity from the Prudential - there is an open market option. If you might qualify for an 'impaired life' annuity because of your health, it is especially beneficial to shop around. You could also get a rebate by buying your annuity through a broker working on a fees-only basis - the savings can be considerable.
• You can still teach part-time and contribute again to the Teachers' Pension Scheme after you have retired - you may even be able to teach full-time if your pension plus your salary does not come to more than the final salary on which your pension is based. (But, if you have retired on ill-health on or after 1 April 1997 you cannot teach again in a school or college covered by the Teachers' Pension Scheme.)
• If you are leaving teaching, but not retiring, Teachers' Pensions can tell you about opportunities to transfer your benefits to another scheme, or to pay contributions during a period of absence. Ask for a benefit statement from Teachers' Pensions to check their records - tell them your national insurance or teachers' reference number.
• If you want to check on any preserved benefits you may have with previous employers outside the Teachers' Pension Scheme, contact the Pension Tracing Service, The Pension Service, Whitley Road, Newcastle upon Tyne, NE98 1BA, 0845 6002 537, www.thepensionservice.gov.uk.
• You can get an estimate of your state retirement benefits by completing form BR19, available from local benefits offices - you can phone through your completed form on 0191 218 7585.
• Don't forget to inform NATFHE's membership department. As a retired member you can continue to enjoy many NATFHE benefits, as well as the opportunity to take part in activities in your region.