Not the best forum for advice on what is a really important subject. Your admin office should have loads of stuff on this by now and in Jul this year everyone will receive a Benefit statement. Basically it comes into effect on 6 Apr this year and you have to make your choice by 6 Apr 07. More info is on

But take professional advice if you are not sure!

Edited to complete an unfinished sentence.
The Forces Pensions Society

are almost certainly the best people to offer advice on this topic. They aren't anything to do with the MOD but they are staffed by ex-Forces bods who know what they're on about.

Bung 'em twenty quid and they'll advise you to your heart's content. Money well spent in my view
The new scheme is based on your rate of pay rather than the current system of representative rates (e.g. all Sgts get the same pension), So if you earn £75 as a Sgt and your mate earns £72, you get a bigger pension.

The minimum length of service is reduced from 22 years to 18 (provided you reach 40).

Pensions are paid from the first day of service (currently 18th birthday or date of enlistment whatever is the latter).

You get two lump sums of 3 x your pension (currently only 1) one when you leave at 40 and 1 at 65.

Those are the good points. Bad points immediate pension at 40 is replaced by Early Departure Payments (EDP) which are 50% (yes 50%) of your pension rising 1.67% for every year after that. Once you hit 55 the EDP increases to 75%.

So take a SSgt/WO2 leaving at 40 after 22 years. The pension is £10,000 a year roughly for both schemes, you get a lump sum of £30,000 on both schemes. But, under the new scheme you get EDP payments of £5,000 until you are 55 and at 55 this rises to £7,500. At 65, finally you get your full pension and a second lump sum of £30,000 (increased with inflation).

Under the current scheme you get the full £10,000 at 40 and the £30,000 lump sum, so if you transfer, HMG saves a fortune between the time you leave and the time you reach 65 and can easily afford to give you a second lump sum. the longer you serve the better the new sceme gets, but if you are only doing the minimum the benefits of transferring are not great.

Briefing packs on benefits payable under both schemes will be out in the Summer to help you make a decision, your RAO should have loads of info on this, and you should be getting P/Pointed to death over the next few months if they haven't started already.

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