There are a number of Service personnel in all sections of the Armed Forces who are being offered extensions of service beyond the point of having accrued the most pension through service as they possibly can, and who regularly ask if service beyond that point is worth it. We cannot answer that question because, despite the Society’s ethos, we fully recognise that there is more to life than a pension..!!
However, that said there are a couple of things to bear in mind, particularly those still on the AFPS75 pension scheme. The moment you reach the maximum service possible the only way your pension award will improve is either through promotion (unlikely, and you have to complete two years in the substantive higher rank to get a full pension relative to that rank) or through salary increases (normally occurring on 1st April each year). In all probability it will be a military pay rise responsible for increasing pension rates that will be helpful to you. Once you enter a pension year (1st April to following 31st March) after reaching the maximum permissible pensionable service, be aware that the amount of pension payable on departure in that year is the same on 1st April as it is the following 31st March – even though you will have worked for an extra 12 months; so exit timing is critical.
The best bit of getting the timing right now hinges on the first pension increase via inflation uplifts. The first one is proportionate based on the length of time your pension has been in payment. If, for example, the inflation figure for next April is 3%, everybody who left the Armed Forces in the first three weeks of April will see their pension increase by the full 3%, but if you decide to go in October you will receive only a 1½% increase, and if you leave December, just 0.75%.
Once you have the maximum pensionable service allowed for the pension scheme you are a member of, by all means take the extensions offered, but chose your exit date very wisely.