Underwhelming RMSPS Pension illustration.

[BenacreNick]

That's why I'm asking for responses from the other fellow workers, to find out if its across the board or just my particular situation.

Probably nothing will change, but it was an underwhelming feeling that I had and wondered if anyone else had the same feeling.

Perhaps because the pension pots are split into 17 different parts, it will all come together when I need it.

[milly]

It's a case of the overall fund value reducing, but the liabilities reducing by more.

I don't think anyone really needs an explanation of how inflation can devalue someone's income, do they?

As far as RM pensions are concerned, the 5% RPI cap only applies to section C, when pensions are in payment. A/B is currently CPI and no cap.

Interestingly, there are plans to replace RPI as a measure of increasing pensions with CPIH, from 2030.
Traditionally RPI has always been higher, but not so more recently. It remains to be seen whether those plans happen, considering current rates.

Very few people understand inflation, many of my colleagues are excited about higher savings rates as they don't realise they are still losing money because they think in nominal terms rather than real terms.
Anyone who does fear inflation owns Gold.
With regard to the 5% cap there are tens of thousands of members in section C who will lose a fortune in purchasing power.

[RobertT]

That's why I'm asking for responses from the other fellow workers, to find out if its across the board or just my particular situation.

Probably nothing will change, but it was an underwhelming feeling that I had and wondered if anyone else had the same feeling.

Perhaps because the pension pots are split into 17 different parts, it will all come together when I need it.

Our Age60/65 pensions have only been increasing by inflation for the last 5 years.

What is it about your situation that makes you think your pension might be different?

[RobertT]

Very few people understand inflation, many of my colleagues are excited about higher savings rates as they don't realise they are still losing money because they think in nominal terms rather than real terms.
Anyone who does fear inflation owns Gold.
With regard to the 5% cap there are tens of thousands of members in section C who will lose a fortune in purchasing power.

Surely they can see how their hard earned wages buy less than they used to?

I'm in section C.

[milly]

Very few people understand inflation, many of my colleagues are excited about higher savings rates as they don't realise they are still losing money because they think in nominal terms rather than real terms.
Anyone who does fear inflation owns Gold.
With regard to the 5% cap there are tens of thousands of members in section C who will lose a fortune in purchasing power.

Surely they can see how their hard earned wages buy less than they used to?

I'm in section C.

They complain about prices going up but they don't understand why it is happening.
Try explaining to the average person whose savings account has had 5% interest added in April that they have lost money and they will think you are mad.
Most people think in nominal terms unfortunately.