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Telegraph - army pensions guide

Journalist: Marc Shoffman, Freelance

ended 14. June 2024

Hello,

I am writing a guide for the Daily Telegraph on armed forces pensions,

Just need views from financial planners or experts in this area on the pros and cons of an armed forces pension, how do they work, how to work out your army pension? Is it worth joining the army/navy/RAF for?

Kind regards

Marc

2 responses from the Newspage community

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Editor
Samuel Mather-Holgate
Independent Financial Adviser at Mather and Murray Financial
The current Armed Forces Pension is a Career Average Related Earnings (CARE) pension. This was changed, in 2015, from the more favourable final salary pension. Every year you are in the military, 1/47th of your salary is locked in to your pension as what you will receive as income in retirement. If you contribute for 24 years you will get just over half (24/47) of the average annual salary you’ve been paid. The pension is non-contributory, so members don’t see any deductions from their pay. This makes it one of the best in the country. Unfortunately low salaries, in most ranks, makes a CARE pension of lesser benefit as most soldiers, sailors and airmen are on a much larger salary later in their career if they stay in the armed forces for a long period.
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Kundan Bhaduri
Property Developer and Portfolio Landlord at The Kushman Group
The armed forces pension schemes are some of the best out there, offering early retirement and inflation-protected payouts that could make a civilian office worker green with envy. You get a lump sum on retirement and generous dependents' benefits, too. But remember, these perks come with strings attached – leaving early can shrink your pension faster than a wool sweater in a hot wash. Always beware of shifting goverment policies - expect a Labour government to deal with veterans differently from the Conservatives.

Service members need to plan their exit strategy carefully, transitioning to civilian life with the precision of a military operation. So, while the pension is a shiny carrot, consider if the military life – with its risks and rigid rules – is the right fit for you. Join for the service, stay for the pension, and maybe, just maybe, you’ll retire with a smile and a stable bank account.