Answers · UK 2025/26

Teachers Pension: final salary vs career average -- which is better?

Final salary Teachers' Pension benefits (for service before April 2015, broadly) are calculated on your salary near retirement, which can be more generous for those with strong late-career pay growth. Career average benefits (1/57th accrual, revalued with CPI plus 1.6%) can suit teachers with flatter pay progression or those who move between full and part-time roles, since each year's pension is locked in and protected regardless of later salary changes.

Last updated: 2 July 2026Last reviewed: 2 July 2026How we verify

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Whether final salary or career average pension calculations work out more generously depends heavily on an individual teacher's career and pay trajectory, and most teachers now have a mix of both due to the McCloud remedy. **How final salary worked** Under the pre-2015 final salary arrangements, your pension was calculated using your salary shortly before retirement (or, for some, the best of the final few years) multiplied by your years of service and an accrual fraction (1/80th for the 1995-equivalent-style scheme structures, broadly). This rewarded teachers whose salary rose significantly in their later career, such as those who moved into leadership roles (head of department, deputy head, headteacher) towards the end of their working life, since even relatively early years of service benefited from the higher final salary. **How career average works** Since April 2015, new pension accrual is calculated on a career average basis: each year you earn a pension amount based on 1/57th of that year's actual salary, which is then revalued each year by CPI plus 1.6% until retirement. This means your pension reflects your actual earnings throughout your career, adjusted for inflation, rather than being weighted towards your final salary. **Who benefits from which system** Final salary tends to favour teachers with strong late-career salary growth (for example, moving into senior leadership), since a large chunk of earlier, lower-paid service gets 'uplifted' to the final salary level. Career average tends to favour teachers with flatter career progression, part-time working, career breaks, or those who move to lower-paid roles later (for example, stepping back from leadership towards retirement), since final salary would otherwise penalise them by basing the whole pension on a lower final salary. **The McCloud remedy blends both** Following the McCloud age discrimination ruling, most teachers who were in service between April 2015 and March 2022 will have that specific period automatically assessed under BOTH the legacy final salary rules (if they were previously in the final salary scheme) and the newer career average rules, with whichever produces the better outcome applied to that period -- so many teachers now benefit from a combination without needing to actively choose. **You generally cannot choose going forward** Since April 2022, all active members build up pension exclusively under the career average scheme, regardless of when they originally joined -- the choice/comparison only applies retrospectively to the 2015-2022 remedy period for those who were eligible. **Practical tip** Check your Teachers' Pensions annual benefit statement, which should show how the McCloud remedy period has been calculated for your specific service, and consider speaking to a pensions specialist if you are close to retirement and want to understand exactly how your final benefit figure has been built up.