Nra65 - dbcs and avc

[rkss]

Whats the best way to use the dbcs and avc whne Nra65 is due fo rme in 2 years, I will be staying on till 67. I am in pension B scheme and not sure I can continue paying into Avc after collection of Nra65.

[RobertT]

What's the best way to use the dbcbs and avc when Nra65 is due for me in 2 years, I will be staying on till 67.

What do you want from your benefits?

Max pension? If so, you can give up some/all of your standard lump sum for more income and transfer out both DBCBS and AVC and buy an annuity.

Max lump sum? Reduce your pension and get the full 25% lump sum from your main NRA65 benefits, and take both the DBCBS and AVC as a UFPLS, meaning the first 25% of those is also tax free.

Or something in between?

Everyone is different and what might be best for one person, isn't necessarily best for another.

I am in pension B scheme and not sure I can continue paying into Avc after collection of Nra65.

Once you take your NRA65, that's it as far as the RMPP is concerned – no more paying into the DBCBS or AVC's(Bonusplan & Flexiplan).

You would currently then have the choice to join the RMDCP instead, and when the new CDC scheme starts you'll be able to pay into that or Nest. All three of which will give you the option to pay additional contributions, on top of the basic. Although not always any extra off RM.

[rkss]

Would prefer max pension. Expecting about 20k on Nra65 lump sum, dbcs should be around 50k by then, I started my avcs only couple of years ago but don't want to do annuity as its not much of a payout, would be arranging drawdowns.
I guess you can't use the sum accrued from dbcs or avc to purchase pension?
I thought one would be able to continue to pay into avcs be it a new one once CD kicks in?
Only reason to pay into avcs is to avoid higher rate tax.
So let's assume there is a new avc one can pay into, are you saying that once Nra65 pays out one cannot continue paying into avc? Or one has to be paying into some pension to qualify to pay into avcs?
Thanks

[RobertT]

Would prefer max pension. Expecting about 20k on Nra65 lump sum, dbcs should be around 50k by then, I started my avcs only couple of years ago but don't want to do annuity as its not much of a payout, would be arranging drawdowns.

I guess you can't use the sum accrued from dbcs or avc to purchase pension?

It's not possible to convert the DBCBS or AVC's into more RM pension.

I thought one would be able to continue to pay into avcs be it a new one once CD kicks in?
Only reason to pay into avcs is to avoid higher rate tax.
So let's assume there is a new avc one can pay into, are you saying that once Nra65 pays out one cannot continue paying into avc? Or one has to be paying into some pension to qualify to pay into avcs?
Thanks

Once you take your NRA65 or the CDC scheme starts, no more payments into the RMPP will be allowed, that includes into the DBCBS and the current AVC's(Bonusplan & Flexiplan).

The plan with CDC is to offer two methods of saving extra: Lump Sum Booster and a DC AVC(probably similar to Flexiplan). You'll have to join CDC to be able to pay into them.

Otherwise you can join Nest, which will be just a bog standard workplace DC scheme, but with lower contributions than the current RMDCP.

Full details of the planned CDC scheme, including what happens to AVC's are here: https://www.myroyalmail.com/collective-plan