A flexible way to save for your future

Did you know that the USS pension is made up of two parts?

USS is a hybrid pension scheme, which means it’s made up of two parts:

• The Retirement Income Builder, the defined benefit (DB) part, gives you a guaranteed income for life, which is inflation-protected up to certain limits, and a one-off, tax-free lump sum, subject to limits, when you retire.
• The Investment Builder, the defined contribution (DC) part, is a flexible savings pot you can use in a variety of ways to suits your needs.

Everyone building a USS pension builds up benefits in the Retirement Income Builder. You can also choose to pay in to the Investment Builder if you’d like to save more. If you were to earn above the salary threshold, you would start saving into it automatically. Transferring in to USS from another scheme would also mean you’d have Investment Builder savings.

Some of the things you can do with the Investment Builder:

• As you get closer to retirement and start to think about the income that future you might need to achieve your lifestyle goals, you can make additional contributions to boost your retirement income or to use in another way that suits you.
• You have flexibility to take your savings before or after you retire in a variety of ways, so your Investment Builder pot can work with your saving priorities.
• You can choose how your savings are invested, or you can let us do it for you – their value depends on how well your investments perform and they can go up or down.
• As with the Retirement Income Builder, you benefit from tax relief on your contributions, and investment costs are subsidised by your employer. *
• You can choose to make ethical investments and invest in funds that align with your personal values and beliefs.
• If you transfer a pension from a registered or recognised overseas pension scheme to the Investment Builder, the only thing you’ll pay for is the investment fees.
• You can invest in private markets which can offer potential greater returns, better diversification, and more inflation protection.

To find out more about how the Investment Builder could affect what you get at retirement, use the Benefit Calculator. See an instant estimate of what you could get in the future and explore the different options available when you come to take your pension.

Additional resources

For more information about your USS pension and how the two parts work together, read your pension explained.

View the PLSA Retirement Living Standards for an estimate of how much expenditure you may need to achieve your desired lifestyle in retirement.

*The employer subsidy covers the investment management charges of the Investment Builder for normal and additional contributions. For benefits transferred in from other pension arrangements, except for Prudential Money Purchase AVCs (MPAVCs), you’ll pay investment management charges.