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AFPS 75 Pension Formula:
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The AFPS 75 (Armed Forces Pension Scheme 1975) is a final salary pension scheme for UK armed forces personnel. It provides a pension based on final pensionable salary and years of service, offering a secure retirement income for those who served.
The calculator uses the AFPS 75 pension formula:
Where:
Explanation: The formula calculates your annual pension by multiplying your final salary by your years of service, then dividing by 70. This provides a proportionate pension based on your service length.
Details: Accurate pension calculation is crucial for retirement planning, financial security, and understanding your entitlements after serving in the armed forces. It helps you prepare for post-service life and make informed financial decisions.
Tips: Enter your final pensionable salary in GBP and your total years of service. Both values must be positive numbers (salary > 0, years of service between 0-70).
Q1: What counts as final pensionable salary?
A: This is typically your salary in your final year of service, including certain allowances but excluding non-pensionable elements.
Q2: How are part-years of service calculated?
A: Part-years are calculated proportionally. For example, 6 months service would be 0.5 years in the calculation.
Q3: Is there a maximum years of service limit?
A: While the calculator accepts up to 70 years, practical limits apply based on age and service regulations.
Q4: Does this include lump sum payments?
A: This calculation shows the annual pension amount. Separate calculations are needed for tax-free lump sums which may be available.
Q5: How does AFPS 75 compare to newer schemes?
A: AFPS 75 is a final salary scheme, while newer schemes may be career-average. Each has different benefits and calculation methods.