Citizens Advice Bureau

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LOCAL INFORMATION

9.8.16
Retirement Pension (Old Age Pension)

Extent:     Jersey

Updated:  5th October 2016

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Words you may need to know

 

Beneficial – something that is of help or a good advantage

Contribution - something that is given, in this case social security contributions

Contribution record - by law everyone living in Jersey is required to pay social security contributions (unless they are exempt). A list of a person’s contributions is kept by the Social Security Department on the person’s Contributions Record.  

See http://www.gov.je/Benefits/Pages/default.aspx

Credit – here, a social security contribution that government has paid for you

Entitlement – something you qualify to get

Exception - a time when a rule does not apply

Forecast - a prediction or estimate of what is likely to happen

Pension - money that is paid as a benefit to people who have reached pension age and who have a sufficient contribution record. 

 

What is a pension?

A pension is a weekly benefit paid to you when you reach a certain age to help cover your basic needs in retirement.

 

The amount of pension you receive will depend on the amount of social security contributions you have paid during your working life.

 

When is a pension paid?

The age when men and women can claim their Jersey Social Security pension has increased.

However, the changes only affect you if you were born on or after 1 January 1955.

 

If you were born before 1st January 1955 your pension age is 65.  The exception is women who joined the Jersey Social Security Scheme before 1st January 1975. They can claim a pension when they reach the age of 60.

 

For full details of how the pension age increases will take effect for anyone born after 1st January 1955 see the Social Security website:

http://www.gov.je/Benefits/PensionsRetirement/Pages/PensionAgeChanges.aspx

 

To work out the amount of someone’s pension the Social Security Department currently looks at a ‘working life period’ of 45 years ie from 18- 65. The person’s pension calculation will be based on social security contributions paid or credited to the person between their 18th birthday and the end of the month prior to their 65th birthday.

To get a maximum 100% pension a person must have a full contribution record for 45 years or more.

 

Introduction of flexible pension age

http://www.gov.je/Benefits/PensionsRetirement/Pages/TakingPensionEarly.aspx

 

People with a pension age of 65 can choose to take their pension at any time between 63 and 65.  However, a reduction  of 0.58% per month of the person’s pension entitlement will be made for each month the pension is paid early. The reduced rate pension is payable for life.

 

For example: if someone has paid contributions for 45 years and takes their pension at 63 they will receive 86% of a standard rate pension. (24 months x 0.58% = 14% reduction approx)

 

There are other things to think about before taking a pension early. For example, taking your pension early may make a difference to how other benefits you might get are paid to you in the future.  For details see the website.

 

Anyone wishing to find out about their future pension entitlement can obtain a forecast by completing a Forecast Application Form, obtainable from the Pensions Section at the Social Security Department.

 

 

Married / Divorced / Separated couples

 

Note:  People’s circumstances are different. Detailed information is on the Social Security website but it is strongly advised that you contact the department for advice. They will advise you according to your individual circumstances and calculate what pension you are entitled to.  The pension you receive will be the most financially beneficial calculation.

In brief:

 

Married couples

In some circumstances men can claim an increase in pension for their wife.

 

When a wife reaches pension age she can choose to have a pension based on her own contributions or a pension based on her husband’s contributions, whichever is higher.

 

If the husband is not 65 when his wife reaches pension age her pension will be calculated on her own record. When the husband reaches 65 Social Security will compare the man’s pension and the wife’s and pay her the highest.

 

Claiming a pension as a married / divorced or widowed woman

There are a number of different rules which affect the pension you may receive. Information is available on the website under the heading ‘Women and Pensions’ or from Social Security.

http://www.gov.je/Benefits/PensionsRetirement/Pages/HowPensionWorks.aspx#anchor-6

 

 

Separation

If a husband is receiving a pension for himself and his wife and his wife leaves the home where they live together, the husband must continue to pay money to his wife in accordance with the amount set by law.

 

If the husband and wife separate when both are aged between 60 and 65, the wife cannot claim her old age pension until her husband is 65. When the husband is 65 a proportion of the joint pension will be paid to her (unless she has paid her own contributions).

 

If they divorce and the wife has not got a full or partial contribution record herself she cannot claim a pension until her husband is 65. When her husband is 65 she will get a proportion of his pension based on the total contributions her husband has made.

 

How your pension is paid

A pension is paid four week’s in advance directly into a person’s account with a recognised bank or building society.  If this is not possible it is necessary to contact the Social Security Department.

 

Further information is available from the Social Security Department: 

Social Security Department, Philip Le Feuvre House, La Motte Street, St Helier.

Contact details:

Telephone:   01534 445505

Fax:              01534 445525

Email:          This email address is being protected from spambots. You need JavaScript enabled to view it.

Opening hours:   Monday to Friday, 8.30am to 5pm