You’ve stopped paying in to USS, but the benefits and savings you built up when you and your employer were paying in could be an important source of income when you come to retire.
Here’s a quick recap of what you have in USS:
- Retirement Income Builder benefits (a defined benefit pension) – you’re guaranteed an income for life once you retire.
- Inflation protected income, the pension you’ve built up in the Retirement Income Builder is increased every April, broadly in line with inflation and subject to certain caps, this provides a level of inflation protection to the value of your benefits.
- A one-off tax-free lump sum (subject to certain limits) – you have the option to take a tax-free cash lump sum from the Retirement Income Builder when you retire.
- Benefits for your loved ones – if something were to happen to you, your USS pension could help provide for your loved ones, with a dependant’s pension. Your spouse or civil partner will get a pension for life equal to half the standard pension you'd have got when you retired, plus any USS standard pension increases up to when you die. Pensions may also be payable to any eligible children and dependants provided that the relevant eligibility criteria are met.
- Investment Builder (defined contribution) savings because you earned above the salary threshold, transferred benefits in from another pension arrangement or made additional contributions to the Investment Builder. You have flexible options to take your savings in a variety of ways.
Your options with the benefits you’ve left:
1. Get a refund
If you paid in to your USS pension for less than two years, you may be eligible for a refund of your contributions. There are certain conditions including that you are not able to receive a refund on any contributions which have been paid on your behalf by your employer under a salary sacrifice arrangement, so visit our getting a refund page to find out more.
2. Transfer out
You can transfer your Retirement Income Builder (DB) benefits into another HMRC-registered scheme, like a personal pension or your new workplace pension scheme.
Before you transfer your USS benefits out, it’s worth considering what you’ll be transferring out and whether it’s right for you. You may need to take independent financial advice first. Visit transferring to another scheme to find out more.
3. Leave your benefits with USS
You might be happy leaving the benefits and savings you’ve built up at USS up until your Normal Pension Age. If this is your plan, there’s nothing you need to do, but we’d recommend you log in to My USS and:
- Use the Benefit Calculator to see what you could get at retirement.
- Complete or update forms in My USS to let us know who you’d like to receive any discretionary death benefits which become payable from the scheme.
- Update your details so we can contact you when it’s time to take your benefits and any savings you have.
For more information on benefits you’ve left with USS, visit our leaver’s hub or register for our Decisions after leaving webinar.