Early Retirement

[Hawkey99]

My wife is 50 this year. She intends on leaving RM when she is 53 and taking her pension at 55.

She has worked for RM for 20 years so far.

Can you please advise what reduction of her pension will occur from her latest statement. Is there any way to calculate this ?

I understand the 5% per year for take the NRA 60 and the 10% for taking the NRA 65.

Thanks

[rambo1]

It'll be a 25% cut on the nra 60 part and a 50% cut on the nra 65 part, I'm afraid. You've got to weigh up whether you would be better not claiming your pension until the relevant times so as not to take a cut, if you have the savings to 'plug the gap' so to speak. Also gotta consider that the illustrations we get are based on us actually working and contributing to the pensions until the relevant ages. Therefore, all in all, if you stop working at 53 you will be drawing considerably less from your pension than what's written in the illustration. Not pleasant reading, I'm sorry to say. If we have enough saved/invested when I'm 55 royal mail won't see me for dust. If there are voluntary redundancy opportunities, all the better. For this to happen we'll need close to £250k in the bank.

[RobertT]

My wife is 50 this year. She intends on leaving RM when she is 53 and taking her pension at 55.

She has worked for RM for 20 years so far.

Can you please advise what reduction of her pension will occur from her latest statement. Is there any way to calculate this ?

I understand the 5% per year for take the NRA 60 and the 10% for taking the NRA 65.

Thanks

The reductions are 5% for each year you take them early, so taking them both at 55 would see the NRA60 reduced by 25% and the NRA65 by 50%.

It’s quite easy to work out roughly what your reductions in money terms would be using your latest annual statement. I’m basing this on my own Section C statement, Section B might be slightly different? Just follow these simple steps:

1. On page 2 you’re given an ‘estimated benefits at 60’ figure. This is your NRA60 and should be reduced by 5% for each year you plan to take it early.

2. On page 4 you have your ‘total pension’ figure which relates to all your pension added together as at statement date(31/3/16). Subtracting your NRA60 amount from this will give your NRA65 amount up to 31/3/16.

3. Work out what another 2 years of NRA65 will give you up to the closure of the RMPP in 2018. To do this either:

i. Divide your NRA65 by 6 and then multiply by 8 giving you a total NRA65 figure; or
ii. Use the ‘CSDB pension at 31/3/16’ figure on page 4 and multiply by it 2 then add it to your NRA65 up to 31/3/16.

4. Reduce by 5% for each year you plan to take before 65.

What is more difficult to work out is how much your NRA65 lump sum would be worth at April 2018. But similar mathematics and reductions will apply to the supplement and NRA60 lump sum.

The pensions website gives more info on how to understand your annual statement: http://www.royalmailpensionplan.co.uk/s ... ur-pension" onclick="window.open(this.href);return false;

You would also need to factor in any money going into the new DC scheme from April 2018 onwards(assuming it’s introduced). RM’s initial proposal would mean a 6% employee and 10% employer contribution. Which based on basic full time pay of £412.30 equates to just under £66 per week going into your DC pot. Although I understand from Dingo’s posts that they have offered a higher contribution rate during recent negotiations.

Any plans to retire early will need serious thought as to whether you can realistically afford to do it.

As the RMPP would be drastically reduced by taking it all at 55, you should try and avoid doing that if possible.

[Fatboyslim]

I took VR at 53. With VR payment. Savings. Shares. And clearing the decks.

We have no loans/mortgage etc. Nothing.

We have a modest income. And we are very happy. I intend to take my pension at 55. I have 35 years in.

Some on here will tell you not to touch your pension. It's what suits YOU. I have seen far too many colleagues retire and die shortly afterwards. I'd rather retire at 55. Be happy. And have all the time in the world. And good health.

I dread to think the toil of the job will effect colleagues in future. i remember seeing colleagues limping into work in a morning. If you can afford to do it. Do it.

Good luck.

[mags999]

WELL SAID

[GT750rider]

I took VR at 53. With VR payment. Savings. Shares. And clearing the decks.

We have no loans/mortgage etc. Nothing.

We have a modest income. And we are very happy. I intend to take my pension at 55. I have 35 years in.

Some on here will tell you not to touch your pension. It's what suits YOU. I have seen far too many colleagues retire and die shortly afterwards. I'd rather retire at 55. Be happy. And have all the time in the world. And good health.

I dread to think the toil of the job will effect colleagues in future. i remember seeing colleagues limping into work in a morning. If you can afford to do it. Do it.

Good luck.

I did exactly the same, only difference I had 37 years in. Like you, we have " cleared the decks ". I've been claiming my pension for 12 months, as I'm now 56.
We are managing just fine. I do have a part-time driving job, which gets me out the house 3 - 4 days a week, and It's my choice which days I work, but no weekends ! I will add I don't need to work financially, as the pension and my investments cover all our needs.
I invite my postie in for a cuppa, but to date, he's always against the clock, although he's not a runner, unlike his cover.
So, if the circumstances are right for you, you might want to consider it. I've never looked back.

[Fatboyslim]

Oddly enough. I feel guilty as I'm part restoring my motorbike. So loads of small packets. And I see my postman limping up the drive. He looks awful. Carrying some sort of fatigue injury. I offer him a cuppa - no time.

I have had two job offers driving. Not interested. Never been so happy retired.

I did just over 35.5 years. I saw some things in my time. And one thing I'll never forget. I once received a POSSS newsletter. It had a survey. And it said if you draw your pension at 65. The average retirement was three years. If you draw it at 60. The average was 12 years. No brainer really. I vowed that I'd be all done by 55.

Some on here will say negative things. If you call your pension in early. But, we are all different. I have seen far too many colleagues pass away too soon. And let's not forget. We are talking 2.5 hour delivery spans here. With the proposed 6 hour deliveries. You will not have a retirement. Believe me.

I saw one colleague who did more hours than Big Ben. Hammered the overtime. Planned to retire like a king. He left 65. Did not even make the first weekend. Another. Did more Sundays than the Pope. In his last 3 years. Two months. Utter tragic. This job is a killer.

My missus took early retirement. After clearing the decks. Our monthly outgoings are a fraction from when I was working. For us it stacks up. Some it will not. We are all different.

[stroller]

Fatboyslim, a fantastic post my friend, you obviously don't care about losing a big percentage of your pension by taking it early, but you have a plan which is much more important and you can make ends meet by going early.

Enjoy your days away from Royal Mail my friend, and it sounds like you are having a fun time.