You can stay in the scheme beyond your normal pension age - in fact as late as 75, if your employer allows you to carry on working for them.
If you retire late, there are no early retirement reductions, and in fact there are late retirement enhancements. These are literally a tiny percentage per day, but we’ve condensed it into this table to give you the idea:
|Pension enhanced by||Lump sum* enhanced by|
|1 year late||3.65%||0.365%|
|2 years late||7.30%||0.730%|
|3 years late||10.95%||1.095%|
Remember if you have benefits both before and after April 2014 then these are different types of benefits, often with a different normal pension age...
Before 1 April 2014: Final salary benefits, with a normal pension age of 65
From 1 April 2014: Career average benefits, with a normal pension age of 65 or your State pension age if later.
So if your State pension age is 67, and you retire at 68, you would be drawing your final salary benefits 3 years late but your career average benefits 1 year late.
* The lump sum enhancement only applies to the automatic lump sum that you built up before April 2008 (not lump sums created by giving up pension).