When you retire you can use some or all of the balance in your Pension Fund to buy an Annuity (i.e. pension). It is very important to make the right choice of Annuity for your individual circumstances and proposed lifestyle throughout your retirement.

The level of your pension will depend on several factors:

• The amount of contributions that have been paid into your Pension Account
• How well the investments have performed
• The level of interest rates at the time of your retirement
• Your age at retirement
• Your health
• The type of Annuity you want.

Because arranging an Annuity is such an important decision and annuity rates can vary greatly we would advise you to seek independent financial advice about the types of annuity available to you. No one in the Company or the Trustees is authorised to give you advice about your options.

Payment of pension

Your pension will be paid under the terms you agree at the time you arrange it – i.e. when you purchase an annuity. Normally, you will arrange for your pension to be paid into your bank or building society current account on a monthly basis.

Once you have arranged your pension with your chosen provider, it is your responsibility to keep them updated with any changes to your bank or building society accounts.  Once the balance of your Pension Account has been paid to your chosen annuity provider, you will no longer be a member of The STM Fidecs Group Pension Scheme.

Pension increases

Depending on the Annuity you buy for yourself and any spouse, civil partner or dependants, you can choose to have a level pension (which does not increase at all during retirement), or a pension that increases in line with price inflation, or some other guaranteed percentage each year.

The advantage of the first option is that a level pension provides, initially, a higher annual amount of pension when you first retire. However, as time goes on, its value will be eroded by inflation.

The advantage of the second option is that as time goes on, although it may start at a lower level, your pension increases (you may choose for it to keep pace with inflation) and so your standard of living would not be expected to decline significantly.

You must choose which is right for yourself. We strongly recommend taking independent financial advice if you are unsure.