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Retirement
from the Public Service
The Government of the Virgin Islands wants
each of its retirees to have a long and comfortable
retirement. This requires planning. Therefore,
we have compiled the following information
to help employees plan for their retirement.
Planning
for Retirement: When will you retire?
The first consideration when planning for
retirement is to decide when you would like
to retire. The Government of the Virgin Islands’
retirement age is 60, although retirement
is allowed under special circumstances after
age 55. Retirement is also allowed on medical
grounds, on the abolition of your post, on
termination of service in the public interest,
or after 25 years of service. There are also
instances of compulsory retirement.
You must give 12 months notice to the Department
of Human Resources before you can retire,
although in some cases six months notice is
accepted.
Based on the nature of your job and the Government’s
need for your services, you may be rehired
on a contractual or temporary basis following
your retirement.
The Department of Human Resources, together
with the Training Division, offers an annual
workshop to help you prepare for retirement.
All employees are encouraged to sign up for
this workshop at least five years before they
plan to retire, if not before. Contact the
Training Division or check its annual
Training Calendar to
find out when the next retirement workshop
will be held.
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Planning
for Retirement: How much income will you have?
It is critical that you make financial plans
for your retirement. Planning will help you
maintain the standard of living to which you
are accustomed. Most Government retirees have
three main sources of income or financial
support: their pension, their social security
benefit, and any savings they may have.
Pension
Estimate your pension and/or gratuity with
our pension
calculator.
The Government pays a pension to all permanent
and pensionable retirees who have served at
least 25 years of service. Retirees may choose
between receiving the full pension amount
every month or a reduced pension plus a lump-sum
gratuity at the end of their service.
Pensions are calculated using a formula that
includes your length of service and your last
salary. The following chart will give you
an idea of the amount of pension you can expect
at various salary levels and years of service:
| Last
monthly salary |
Years
of Service |
Full
pension (monthly) |
Reduced
pension (monthly)
/ Gratuity |
|
$2,000 |
25 |
$1,000 |
$750
/ $37,500 |
|
$2,000 |
33 |
$2,000 |
$990
/ $49,500 |
|
$3,000 |
25 |
$3,000 |
$1,125
/ $56,250 |
|
$3,000 |
33 |
$3,000 |
$1,485
/ $74,250 |
|
$4,000 |
25 |
$4,000 |
$1,500
/ $75,000 |
|
$4,000 |
33 |
$4,000 |
$1,980
/ $99,000 |
|
Permanent and pensionable employees who retire
before attaining 25 years of service are eligible
for a lump-sum gratuity.
Daily-paid, or non-established, workers with
seven or more years of service are also eligible
for a gratuity or, in some cases, a monthly
allowance upon their retirement.
A daily paid worker with between 7 and 15
years of service will receive a lump-sum gratuity
equal to two weeks pay for each complete year
of service.
An officer with 15 or more years of service
will receive a gratuity equal to two weeks
pay for each year of service up to 15, and
four weeks pay for each year of service over
15 years, up to a maximum of 1.25 times your
last yearly salary. In some cases, daily paid
workers may opt instead for a monthly allowance
instead of the lump-sum payment.
The information on this
website is general only. Call or visit the
Human Resources Department Benefits Administration
Unit at 494-3701 ext. 2178 to find out exactly
what your pension benefits will be.
Social Security
When you are making your financial plans for
retirement, take time to determine whether
you will be eligible for an age grant or pension
from the Social Security Board. While Social
Security’s age benefits are generally
less than the pensions paid by Government,
they can still play an important role in your
finances.
An age benefit is paid to insured persons
who reach the age of 65 and satisfy the necessary
contribution conditions.
An age grant is paid to insured persons who
are 65 years old and have made at least 50
but less than 500 weeks of contributions.
The grant is equal to six times your average
weekly insurable earnings, multiplied by the
number of completed 50 weeks of contributions.
An age pension is paid to insured persons
who are 65 years of age and have made at least
500 weeks of contributions. The pension is
equal to 30 percent of the average annual
insurable earnings, plus an additional 1 percent
for each 50 contributions in excess of 500.
Please note that at present, the maximum level
of earnings insured by Social Security is
$23,400 per annum. Social security age benefits
are not retirement benefits; you may continue
to work. No social security contributions
are deducted from the salary of persons who
are over 65.
For
more information about your Social Security
age benefits, visit the Social Security Board’s
website at www.bvissb.vg,
or call 284/494-3418.
Personal savings
You should not rely solely on Government pension
and Social Security age benefits to finance
your retirement. Personal savings will allow
you to weather unexpected events and expenses
without loosing your financial independence.
The key to successfully saving for retirement
is to start, and to start as soon as possible.
The earlier you begin saving for your retirement,
the less you will have to put aside every
month and the longer your money will have
to grow. Many financial planners recommend
saving 10 percent of your monthly income.
Some of this savings can be for short-term
goals, but some should be for long-term goals
like retirement.
For help starting a personal savings plan,
speak to a financial advisor or visit one
of these helpful websites:
Public radio’s Motley Fool radio show
provides advice on investing for retirement
at www.fool.com.
The American Association of Retired Persons
(AARP) has comprehensive information about
pensions and retirement at www.aarp.org.
Planning
for Retirement: Social and emotional changes
Going into retirement is almost like starting
a new job. As a result, some adapting and
adjusting will be necessary. Some days may
bring feelings of uncertainty, which may result
in mood swings. You may also experience “high
and low” periods. The initial reaction
to becoming unemployed can last from as little
as a few minutes to as long as many weeks.
These feelings may have an emotional effect
similar to that of losing a close relative
or friend; or you may experience feelings
similar to those associated with the long
awaited return of someone or something of
great importance. Retirement affects each
person differently, but it does affect everyone
going through this transition. Regardless
of the emotion, it may take some time for
you or other persons close to you to adjust
to your new situation.
Taking back control of your life is something
that you will have to do eventually, and you
will have to put some work into it. It will
be much more difficult if you are still in
the shock or depression state, though not
impossible.
An officer within the Employee Relations Unit
will be happy to meet with you to assist you
with the decision making process as you prepare
to move into private life. Contact us at 494-3701
ext. 2178. You may also receive guidance on
subjects such as:
• Coping
with the loss of income from your job
• Health care inforation
•
Volunteer work
• Community social
services and action programmes
•
Part-time/full-time continuing education
• Part-time employment
• Basic
financial management guidance
As you prepare for retirement, it is helpful
to consider the following questions:
What will you do with your time?
• New career or job
• Volunteer
work
• Travelling
Where will you live?
•
Present residence
• New residence
• New country
Are
your legal matters in order?
• Will
• Spousal/child support
Are your financial matters
in order?
• Benefits (pension
and social security)
• Personal
savings
• Life insurance
How is your health?
• Specific
illnesses
• Medical insurance
• Regular check-ups
The following agencies and organisations provide
services you may wish to access in your retirement:
Social
Security Board
Social Development Department
Adina Donovan Home
BVI Red Cross
Community Health Services
Department of Labour
Library Services
Tortola Sports Club
Cutting Edge Fitness Centre |
www.bvissb.vg
494-3418
494-3431
494-4690
494-6349
494-3701 ext. 2168
494-3701 ext. 4708
494-3428
494-3457
495-9570 |
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