Many people would be interested in knowing how TSC calculates pension lump sum for teachers. TSC has a very good pension scheme for teachers. Once they retire, TSC calculates the amount of money a teacher is supposed to be paid in a lump sum. The remaining amount is paid in monthly installments to ensure that a teacher does not suffer in retirement.
Types of pension schemes
Teachers over 45 years of age are part of a non-contributory pension scheme that will benefit them after they retire. Those below 45 years were bundled in a contributory pension scheme where they contribute 7.5% of their monthly salary while TSC tops it up with another 7.5%. It is called the Public Service Superannuation Scheme, PSSS.
Factors that determine the amount of pension one gets
There are three main factors that TSC takes into consideration when calculating your pension lump sum and monthly installments. Firstly, they look at your pensionable emoluments. This is the salary and allowances you used to earn before going to retirement. The higher your salary and allowances, the higher your lump sum and monthly installments.
That is why you see many teachers going for promotion interviews even as they approach retirement. You will find a teacher going for a promotion interview yet they only have only one year before hanging their boots. They are only trying to boost their pensionable emoluments. Every shilling counts during retirement.
The second most important factor that helps in calculating one’s pension lump sum is the years of service. This is commonly referred to as pensionable service. It is the period a teacher works before going to retirement.
Teachers who work for many years earn a more handsome pension. Remember, only teachers employed on permanent and pensionable terms are entitled to that money. Short term contracts do not county.
Age of the teacher
Thirdly, the age of the teacher at retirement matters when TSC calculates pension lump sum and pension monthly installments for retiring teachers. There are those that opt for early retirement. Those ones only reduce their pension amounts. TSC rewards teachers who retire at their correct ages of 60 years or 65 years (for those abled differently).
The formula for calculating pension is simple.
Pension lump sum is equal to Pensionable emoluments divided by 720 then multiplied by pensionable service. 720 is the number of months it takes one to retire from service. 720 months is equal to 60 years.
Pension lump sum = pensionable emoluments/720 x pensionable service.
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