Planning your retirement
Follow these steps to plan your retirement
Retirement timeline
To help you understand how long the retirement process can take and the steps involved, we’ve put together this timeline for you to use as a guide. It’s important that you start thinking about and planning for your retirement as early as possible. If you have a date in mind that you wish to retire by, make sure you have started the process early enough to meet your goals.
Make the most of your pension contributions
- Can you pay in more to your pension savings? If you’re still an active employee at AXA or an active member of another pension scheme it might be worth looking at how much you’re currently paying in each month and checking to see whether you could increase this amount to boost your pension savings for when you retire.
Track down any lost pensions
- If you’ve changed jobs during your career or ever saved into a personal pension it’s likely that you’ll have multiple pensions. It’s easy to lose track of these. At this stage it’s a good idea to track down all the pensions you might have.
- Contact each pension scheme to find out what your savings could be worth, and at what age you can start to access them. If you’ve lost contact with any schemes, use the Pension Tracing Service. Find lost pensions.
Start thinking about your retirement options
- As a member of the AXA Pension Scheme there are a few options available to you when it comes to taking your pension. Whether that be taking your full pension from the Scheme; taking the maximum tax-free cash lump sum along with a reduced pension each month; or transferring your pension elsewhere after having taken independent financial advice to do so.
- You can find out more about the ways to receive your DB pension on the MoneyHelper website.
10 years before retirement
Decision on Retirement Age
- Decide on the age at which to retire. This may depend on individual circumstances, financial considerations, and health.
- You can read here about early retirement or ill health retirement.
Check pension and State Pension entitlement
- Review the savings you have.
- Review your pension statements to understand the size of your pension from different employments.
- Check your State Pension entitlement with the government.
Budget planning
- Start thinking about how much you will need at retirement. You can use MoneyHelper's useful budget planner to get an idea for how much your lifestyle would require.
If you’re interested in taking your pension and you’d like more details about how much you might get at your chosen retirement date, you’ll need to contact the Administration Team at Capita to request a retirement quote using the details on the Contact us page.
Please note, the Administration Team at Capita can provide a retirement projection at any date in the future, however, it won’t be guaranteed and will just be an estimate. If you would like to run your own retirement quote, you can do this online using the retirement illustrator on your online pension account here. There is no limit to the number of quotes you can request.
It’s also worth thinking now about whether you would like any financial advice to help you plan ahead.
5 years before retirement
You'll be contacted by the Administration Team at Capita to see if you still intend to retire on your retirement date. If you decide you want to retire later, they'll issue you with a Late Retirement Consent form to complete.
If you want to proceed with your planned retirement, the Administration Team at Capita will send you a pack with details of your retirement options (either at your request or automatically as you approach the Scheme’s Normal Retirement Age). You should select the retirement option that best suits you and send your completed forms back to them with any other documentation they request in your retirement pack.
If you are at all unsure of what options you should take regarding your retirement, we recommend you take professional financial advice. You can find a Independent Financial Adviser (IFA) here.
6 months before retirement
Once you have completed the questionnaire you will recieve, the Administration Team at Capita will send you a pack with details of your retirement options (either at your request or automatically as you approach the Scheme’s Normal Retirement Age). You should select the retirement option that best suits you and send your completed forms back to the Administration Team at Capita with any other documentation they request in your retirement pack.
Once your retirement has been processed, you’ll receive a Retirement Letter. If you have opted for monthly payments, you’ll receive confirmation that your pension has been put into payment and when you will receive your payments each month.
Once you start receiving your benefits you’ll be able to log in to your online account to view your payslips and P60s.
Planning your retirement
How to start planning
Now you have an idea of what you have and what you think you’ll need in retirement its good idea to make a plan for this. There are lots of things you can do to prepare yourself for life in retirement, such as working out what you've got saved already, what you'll need and what you want your retirement to look like.
Working out what you’ve got
Whether you’ve got savings through an employer’s pension or a personal one, the first step is to work out what you’ve got and where.
Start by reviewing the amount you have in your AXA pension. You can log in to your online pension account to view your current total pension. This will give you a good starting point for how much you currently have saved.
Review your pension
Check how much you might get from your State Pension You’ll get a regular amount of State Pension each week and this generally increases every year in line with inflation. This will form part of your regular retirement income so it’s good to know how much you can expect to receive.
Check your State Pension forecast
Find out if you have any other pensions that you might have with previous or current employers. If you know of other pensions you’ve paid into in the past, make sure you locate these and factor any extra pension savings you have into your retirement planning.
Find other workplace pensions
Include any other savings or income you may have. When calculating how much you will have at retirement you should include any money you have in personal savings accounts or any income you still expect to be receiving once you have retired. This could include rental income or any part time work you might continue or take up.
Working out what you’ll need
Once you’ve figured out how much you’ve already got saved up, you need to work out if that will be enough to support the retirement that you want to have. It’s a good idea to ask yourself some questions about the life you’ll be living once you finish working.
Questions to ask yourself:
1. What will you no longer need to pay for?
2. What will you have to pay for that you don’t spend money on now?
3. Are there any things you would like to do you once you’re retired?
It's useful to use a pension calculator to get an estimate of the income you'll need when you retire. This will also show you if you have any gaps in your savings and how you can plan to boost these.
MoneyHelper provide a free pension calculator that you can use on their website.
Calculate your pension
What you want your retirement to look like
Now you have an idea of what you have and what you think you’ll need, its a good idea to make a plan for the retirement you would like to have.
Here are some things you’ll need to think about:
- When would you like to retire? This may depend on individual circumstances, financial considerations, and health.
- What kind of lifestyle will you want to live? For example, are there any big trips you would like to go on or any big purchases you're planning on making?
- Will you have any debts that you won’t have paid off when you retire? It’s important to try to and start your retirement with as little debt as possible. As your income is likely to go down when you retire any extra fixed payments you’ll need to make is something you should consider.
Ill health/Early/Late retirement
Ill health can significantly impact your retirement plans, and the Scheme offers provisions for individuals facing qualifying health challenges. If you experience ill health, you may be eligible for early access to your pension. The specific criteria for ill health retirement may vary between different pension schemes you are a member of, but generally it involves demonstrating that you are unable to work due to your health condition.
Please refer to the Scheme information section on your online pension account.
Choosing early or late retirement plays an important role in pension planning.
Opting for early retirement allows you to access your pension sooner but may result in lower pension payments. On the other hand, delaying your retirement could lead to an increased pension. It’s essential that you carefully evaluate your financial situation, health and lifestyle to make an informed decision aligned with your retirement goals.
The minimum age at which you can access your pension is 55. This is known as early retirement. Be aware your pension may be subject to early retirement reduction if you retire at this age. Please note that this minimum age will be increasing to 57 in 2028 and thereafter it will be 10 years before the State Pension age.
The Scheme's Normal Retirement Age differs depending on the section you are in, but could be 60, 62, 63, or 65. This is the earliest age you can take your benefits from the Scheme without any early retirement reduction. If you are approaching age 55 or over, you can contact the Administration Team at Capita for an estimate of your pension options.
Budget planner guidance
Budget planning is incredibly valuable when it comes to effective retirement planning. Assessing your current financial situation will allow you to identify areas for potential savings, and help you set realistic retirement goals. You should think about the type of lifestyle you want to have when you retire.
Consider the following questions:
What do you want your
retirement look like?
How much will this
cost you?
How long will your money
have to last?
Remember, your full pension could consist of income from multiple schemes, savings accounts, investments and the State Pension. Don’t forget to make a plan to manage any debt you might have including bank loans, student loans and mortgages.
By understanding how much money you need to achieve the retirement lifestyle you want, you can check whether your current pensions savings, and any other sources of income you’ll have at retirement, can support this. Taking a proactive approach early will enable you to make informed decisions about your current pension contributions and how you choose to invest them. It will also help you understand if you need to make any lifestyle adjustments to support your move towards a more secure financial future.
If you would like to view a forecast of the likely pension income you might get when you come to retire or see how your retirement age may affect your income, you can use MoneyHelper's useful pension calculator.
Planning your retirement
Your options
There are different options to consider when taking your pension benefits including tax free lump sums, income, and annuity purchases. We’ll go into more detail about your options below:
Defer
taking your
pension
You may decide to delay taking your pension while you decide on the best course of action. If you want to retire after Normal Retirement Age (NRA), you’ll just need to get in touch to let us know. You can do this by phoning the Administration Team at Capita on 0370 1234 701 or fill out the ‘Contact us’ form on your online pension account here.
Take a regular monthly pension for the Scheme
You may choose to take all of your benefits as a regular, monthly pension which will be paid for the rest of your life. These payments are increased each year and there may be certain death benefits payable upon your death.
Take a reduced
pension and a
tax-free lump sum
You are eligible to take some of your pension savings as a tax-free lump sum. Your remaining pension benefits will then be used to pay you a regular monthly pension going forward. The monthly payments will be lower than if no tax-free lump sum was taken. This lower regular pension will still be paid monthly, increased each year, and there may be certain death benefits payable upon your death.
Take a small,
one-off lump
sum payment
If the total value of all your pension savings is less then £30,000, you may have the option to take your benefits as a small, one-off lump sum payment. This is sometimes known as a trivial commutation lump sum. In this option, you receive a one-off payment from the scheme and no further pension or death benefits are payable. Please note, this payment can only be made providing you meet the conditions detailed on the Trivial Commutation Small Lump Sum form.
Transfer
your
pension
You may be able to transfer your current pension to another provider. This depends on the Scheme rules relating to your section and you’ll have to take independent financial advice before you can transfer out if your benefits are valued at £30,000 or more. To explore this option, you will need to complete a Transfer Request Form for a quote and more information. It’s important to make sure the benefits you expect to receive remain protected if you choose to transfer your benefits to another provider.
Getting quotes
Once you’ve made your decision to retire, you should initially talk to your manager to agree the details. Once agreed, you must give your employer written notice as detailed in your employment contract. When the Administation Team at Capita receive notification of your retirement from your employer, or you’ve confirmed the date you wish to take payment of your deferred benefits, they will send you an estimate of your benefits and retirement application paperwork.
Your estimate will include details of the pension you’ll receive and the options available to you if you wish to convert some pension into a tax-free lump sum. You’ll then need to make decisions on the amount of pension you wish to convert to a cash lump sum.
Once you know when you want to retire, you should ensure your application is completed and returned six months before your proposed retirement date.
It’s important that you fully complete all the forms that are sent to you, as any omissions could result in a delay in the payment of your benefits. When Capita receive all relevant documentation from you, if you are still at AXA, and your pensionable pay figures from your employer’s payroll department, your pension benefits will be calculated. Confirmation of the actual amount payable will be sent to you.
Once all paperwork has been processed and your benefits have been calculated, your pension will be paid directly into your bank account on the last working day of each month for the rest of your life.
In addition to your AXA pension, you can also receive the State Pension. This is a regular payment from the government and most people can claim this when they reach State Pension age. Your State Pension age depends on when you were born, but for most people is now age 66.
However, it is gradually rising to age 67 for anyone born after 6 April 1960 and to age 68 if you were born after 6 April 1977. If you were born before 6 October 1954, your State Pension age is between 60 and 66 depending on when you were born and whether you are a man or woman.
The amount of State Pension you’ll get depends on how many qualifying years of National Insurance payments you have. This includes National Insurance contributions that you pay when you are working and contributions that are credited to you when you are unable to work. The most you can get from the State Pension is currently £221.20 per week (2024/2025).
More about the State Pension
Planning your retirement
Getting guidance and advice
Pensions can be a very complex subject and it's important that you have all the information you need when it comes to taking your pension, so you can make informed decisions on what's best for you.
Getting guidance
There are lots of resources to help you at whatever stage you are with your retirement planning. Below are two platforms that provide useful information to help whatever stage you're at.
MoneyHelper brings together a number of helpful services, including Pensions Wise, which can provide guidance around your pension savings, but also wider financial issues like debt and savings.
Pension Wise is a government service that offers free, impartial pensions guidance about your defined contribution pension options. An appointment will help you understand what your overall financial situation will be when you retire. It will focus on your options to help you make the right decision for you, and also allow you to find out about the other factors you need to consider when deciding on your options before retirement. During a Pension Wise appointment, an independent pension specialist will:
- explain your pension options
- explain how each option is taxed
- tell you what your next steps are
If you are not taking regulated financial advice, we strongly recommend that you book an appointment with Pension Wise your options for any defined contribution pension savings you have. The appointment will take between 45-60 minutes and can be over the telephone or somewhere local to you.
These appointments can be booked online directly with Pension Wise, or you can call them on 0800 138 3944 to book an appointment.
Book your Pension Wise appointment online
Getting advice
If you think you’d like to receive personalised financial advice, you will need to get in touch with an Independent Financial Adviser (IFA).
The Trustee, AXA and Capita, the Scheme's Administrator, cannot provide you with any financial advice when it comes to your benefits within the Scheme.
An IFA can look at all your financial arrangements and provide you with personalised advice to help you make an informed decision about your retirement.
You should bear in mind that an adviser will charge for their services, but that expense might be worth it in order to ensure you’re making the best decisions for your future.
Find an Independent Financial Adviser
All financial advisers are regulated by the Financial Conduct Authority (FCA), so they must follow strict rules when they give you advice. Make sure your adviser is registered before you start planning.
Check if an adviser is on the Financial Services Register
What you can do to increase what you have
You’ve already made valuable contributions for the future by paying into your AXA pension, but you might find that on top of your AXA pension savings and your State Pension you would still like to save more to have enough for the retirement you want.
You’re able to check the amount of State Pension you are set to receive on the government’s website. By reviewing your expected State Pension amount you might find that there are gaps in your National Insurance record and may be able to pay in Voluntary National Insurance Contributions to increase your State Pension amount. Check your State Pension forecast.
It might be that if you’ve changed jobs several times over the years and there could be old pensions that you’ve lost track of. If you’re looking for a lost workplace pension and know the name of the employer or scheme you can use the Pension Tracing Service via the government website. If not, they also offer a service to find the pension contact details you might need. Find pension contact details or contact the Pensions Tracing Service.
If you would like to know more about what to do with the money you have saved or how you may be able to increase it, you can speak to a regulated adviser who will go through their fees and charges with you before you commit. Find a retirement adviser.