1. What is the AFPS 05 Pension Scheme?

The Armed Forces Pension Scheme 2005 (AFPS 05) is a career average pension scheme for UK military personnel. It provides a pension based on pensionable earnings and years of service, with benefits revalued annually.

2. How Does the Calculator Work?

The calculator uses the AFPS 05 pension formula:

Where:

• \( PE \) — Pensionable Earnings (GBP)
• \( Years\ of\ Service \) — Total years served in the armed forces
• \( 69.75 \) — Accrual rate divisor

Explanation: The formula calculates the annual pension entitlement based on career average earnings and length of service, with the pension being revalued annually.

3. Importance of Pension Calculation

Details: Accurate pension calculation is essential for retirement planning, financial security, and understanding future benefits under the AFPS 05 scheme.

4. Using the Calculator

Tips: Enter pensionable earnings in GBP and years of service. Both values must be positive numbers (earnings > 0, years > 0).

5. Frequently Asked Questions (FAQ)

Q1: What are pensionable earnings?
A: Pensionable earnings typically include basic pay plus any pensionable allowances under the AFPS 05 scheme.

Q2: How is the accrual rate determined?
A: The 1/69.75 accrual rate is set by the scheme rules and represents the fraction of pensionable earnings earned per year of service.

Q3: What does "revalued" mean?
A: Pension benefits are increased annually in line with inflation (CPI) to maintain their real value until payment.

Q4: When can I claim my AFPS 05 pension?
A: Typically at age 65, but early retirement options may be available depending on length of service and circumstances.

Q5: Are there additional benefits?
A: Yes, AFPS 05 may include lump sum death benefits, ill-health retirement benefits, and dependants' pensions.