CDC 2024

[rogersh]

Andy Fury stated yesterday re CDC "We're optimistic will come in early in the new year". So April is a possibility.

[NWpostie]

More time to build up my Flexiplan and Bonusplan AVC, this will stop once the CDC scheme comes in, I would do the same if I were you max out as much as you can within the PSE rules, you only get one chance at this.

Looking at possibly 10 month remaining assuming an April 2024 start.

Only thing is assuming I retire at 60 I will only have built up 3 years in the CDC.

[sweepster70]

More time to build up my Flexiplan and Bonusplan AVC, this will stop once the CDC scheme comes in, I would do the same if I were you max out as much as you can within the PSE rules, you only get one chance at this.

Looking at possibly 10 month remaining assuming an April 2024 start.

Only thing is assuming I retire at 60 I will only have built up 3 years in the CDC.

My Bonus plan is fixed at £12.48 a month. I have been told this has stopped and is the maximum myself and Royal Mail can pay into this?

[NWpostie]

I'm still paying into my bonus plan according to my payslip, the amount is fixed RM and yourself pays into it, the amount is set so you can't increase it..

Flexiplan you can pay as much as you like within the PSE limit, I'm paying £110 a week = £5720 a year, this will form my lump sum on retirement so I can leave my pension alone.

[freespeech]

More time to build up my Flexiplan and Bonusplan AVC, this will stop once the CDC scheme comes in, I would do the same if I were you max out as much as you can within the PSE rules, you only get one chance at this.

Looking at possibly 10 month remaining assuming an April 2024 start.

Only thing is assuming I retire at 60 I will only have built up 3 years in the CDC.

My Bonus plan is fixed at £12.48 a month. I have been told this has stopped and is the maximum myself and Royal Mail can pay into this?

Yes, BP has that maximum but you are free to start any of the other AVC options. I'm currently paying into the lifestyle option of FlexiPlan.

[Duran]

I'm still paying into my bonus plan according to my payslip, the amount is fixed RM and yourself pays into it, the amount is set so you can't increase it..

Flexiplan you can pay as much as you like within the PSE limit, I'm paying £110 a week = £5720 a year, this will form my lump sum on retirement so I can leave my pension alone.

Why would you not take 25% of you pension pot, as a tax free lump sum ? Leaving it all to pension salary means you will be paying a minimum of 20% on your entire pension. Food for thought.

[RobertT]

I'm still paying into my bonus plan according to my payslip, the amount is fixed RM and yourself pays into it, the amount is set so you can't increase it..

Flexiplan you can pay as much as you like within the PSE limit, I'm paying £110 a week = £5720 a year, this will form my lump sum on retirement so I can leave my pension alone.

Why would you not take 25% of you pension pot, as a tax free lump sum ? Leaving it all to pension salary means you will be paying a minimum of 20% on your entire pension. Food for thought.

If you do that and have AVC's, you'll pay tax on 75% of that money instead.

The whole idea of AVC's is to fund the tax free lump sum, so you don't have to give up any pension to get one. Ideal for section C members who don't get a lump sum as standard.

You might have to pay a bit of tax on the pension, but you get a higher index linked income for life. And if you save enough, the 25% tax free pension commencement lump sum too.
The best of both worlds!

*Pension income is taxed in the same way as wages, so currently the first £12,570 of income per year is tax free.

[Duran]

Yeah . I get that. I’m section B 39 years. Leaving in 2 years when 60. Intend to use 25% tax free lump sum as draw down to supplement pension till 67. Will leave Cash Balance and NRA 65 until 65. I’m night VOC driver Expecting NRA60 to be around 12k per year after i take 25% tax free. Thats what works for me. I understand everyone's position is different.

[Engy]

I'm section B and night Voc driver also but I'm using Avc to pay lump sum hopefully. I can do that as section B also can't I Robert.

[linntroika]

Section B automatically generates a lump sum if you wish to take it . From looking at a colleagues pension lately who is also in section B as am i , i will be transferring my AVCs into a SIPP via hargreaves lansdown
This looks like the best approach to generate max lump sum , im sure Robert will clarify

[RobertT]

I'm section B and night Voc driver also but I'm using Avc to pay lump sum hopefully. I can do that as section B also can't I Robert.

Section B automatically generates a lump sum if you wish to take it . From looking at a colleagues pension lately who is also in section B as am i , i will be transferring my AVCs into a SIPP via hargreaves lansdown
This looks like the best approach to generate max lump sum , im sure Robert will clarify

It is possible to commute some of your standard lump sum to get more pension if you want to, and then use the AVC's for the tax free cash.

Or transferring would potentially mean more lump sum, although not necessarily all tax free.

As ever, it'll depend a lot on individual choices and the amounts of money involved.

[heapsy]

I'm still paying into my bonus plan according to my payslip, the amount is fixed RM and yourself pays into it, the amount is set so you can't increase it..

Flexiplan you can pay as much as you like within the PSE limit, I'm paying £110 a week = £5720 a year, this will form my lump sum on retirement so I can leave my pension alone.

Looking in to my payments. Could I ask you, what are your contracted hours, and are you working in delivery or some other function, such as HGV which attracts higher pay?
I'm currently paying Bonus plan plus £83 per week Flexi plan and am within PSE. Many thanks.

[NWpostie]

I'm still paying into my bonus plan according to my payslip, the amount is fixed RM and yourself pays into it, the amount is set so you can't increase it..

Flexiplan you can pay as much as you like within the PSE limit, I'm paying £110 a week = £5720 a year, this will form my lump sum on retirement so I can leave my pension alone.

Looking in to my payments. Could I ask you, what are your contracted hours, and are you working in delivery or some other function, such as HGV which attracts higher pay?
I'm currently paying Bonus plan plus £83 per week Flexi plan and am within PSE. Many thanks.

Full time hours, delivery section, I kept within PSE, of course for personal security reason I can't say where my location is.

I would say £110 is sailing close to the wind as far as I'm concerned, it's an investment toward my future and I'm learning to live with what remained of my wages.

[heapsy]

Thanks for the reply. I'm wondering about the impact of a possible pay rise from the deal. I'm section C and I think the pensionable pay element on the pay slip may change, so I'm wary of increasing the Flexi plan by too much. AVCs are somewhere North of 43k at the moment but not sure if I'll get the full 25% from them as a lump sum. I didn't ask you where you worked btw.

[robking]

Thanks for the reply. I'm wondering about the impact of a possible pay rise from the deal. I'm section C and I think the pensionable pay element on the pay slip may change, so I'm wary of increasing the Flexi plan by too much. AVCs are somewhere North of 43k at the moment but not sure if I'll get the full 25% from them as a lump sum. I didn't ask you where you worked btw.

Pensionable pay and actual pay are different, pensionable pay goes up on 1st of April by the rate of inflation the previous September regardless of actual pay changes.
For example if the current deal is agreed our actual pay will increase by 6% backdated to April 1st this year and by 2% from April 1st next year (forget additional lump sums, they're not relevant here).
Last September the RPI rate of inflation which is used for Section C was 12.6% so our pensionable pay went up by that amount, you will probably have noticed a small reduction in take home pay because of this.
Inflation has fallen a bit so lets say the RPI rate in September this year is 7%, next April our pensionable pay will increase by that amount but our actual pay will only rise by 2% and there will be a further reduction in take home pay because more of our pay which was non pensionable will become pensionable.