AVC self-management choices ..

south London postie · Post by **south London postie** » 06 Jun 2019, 18:02

Helo! I wonder if anyone might be able to offer thoughts on this. I've been with RM almost 3 years and recently moved onto the sun-kissed slopes of AVC, moving from 6% of my part-time earnings to 30%. I'm now looking at taking the full pension pot sum out of the default 10-year hows your father, into the more self-managed area.

I am aware of the charts and the fund fact sheets, what I am confused about is which funds are available to me.

Until today, I thought the funds on this page would be my AVC self-selected options: http://webfund6.financialexpress.net/cl ... eID=443712" onclick="window.open(this.href);return false;

But the lovely lady at Zurich today pointed me at this: http://webfund6.financialexpress.net/cl ... eID=261501" onclick="window.open(this.href);return false;

The fund fact sheets offer slightly different info, as well. Anyone got any thoughts?

itinerant · Post by **itinerant** » 06 Jun 2019, 18:18

I did the same recently, started paying a decent amount into AVCs and moved everything out of the lifestyle option into "Inflation Linked Bonds" (one of the options in the 2nd link you provided).

The investment choice is, of course, down to your attitude to risk, number of years to retirement and any other provision you may have. I have some other pensions, one of which is primarily invested in shares so I have decided to focus my RM DC pension pot on more cautious option to provide overall balance (I have been with RM 2 years and aim to do 10 years service max, maybe less).

Post by **RobertT** » 06 Jun 2019, 18:53

south London postie wrote:Helo! I wonder if anyone might be able to offer thoughts on this. I've been with RM almost 3 years and recently moved onto the sun-kissed slopes of AVC, moving from 6% of my part-time earnings to 30%. I'm now looking at taking the full pension pot sum out of the default 10-year hows your father, into the more self-managed area.

I am aware of the charts and the fund fact sheets, what I am confused about is which funds are available to me.

Until today, I thought the funds on this page would be my AVC self-selected options: http://webfund6.financialexpress.net/cl ... eID=443712" onclick="window.open(this.href);return false;

But the lovely lady at Zurich today pointed me at this: http://webfund6.financialexpress.net/cl ... eID=261501" onclick="window.open(this.href);return false;

The fund fact sheets offer slightly different info, as well. Anyone got any thoughts?

You're in the DC scheme, so the funds in second link you provided are the ones you can invest your money into.
You can find out a little bit more about these funds here.

The first link is for those in the RMPP and wish to pay AVC's to enhance their tax free cash(the usual use) when taking their DB benefits.

south London postie · Post by **south London postie** » 06 Jun 2019, 20:58

Robert, thanks for the information and that link. All prepped for the phone call tomorrow :)

itinerant, yep, no one to blame but ourselves now ...

I've left it all far too late so will likely treat it as a mid-career decision.

Will also ask Zurich about Flexiplan and Bonusplan as I got side-tracked with this.

Post by **RobertT** » 07 Jun 2019, 04:20

south London postie wrote:Robert, thanks for the information and that link. All prepped for the phone call tomorrow :)

No problem!

Will also ask Zurich about Flexiplan and Bonusplan as I got side-tracked with this.

Flexiplan & Bonusplan are for RMPP members.
As a DC member all your contributions, including anything over the 6% standard amount, go into one pot via whichever fund/s you invest in.

south London postie · Post by **south London postie** » 08 Jun 2019, 01:19

I have now *re-positioned* to my Bat Out of Hell Strategy

Thanks again fr the pointers

south London postie · Post by **south London postie** » 20 Jun 2019, 15:17

Having settled into the wonderful world of self-harm, I'm sorry self-investment, I am now - just looking - at how feasible it might be to take money from my Zurich account and put in, for example, a regular stocks and shares ISA (I'm quite interested in dabbling in a small way beyond what is on offer via the RM fund options)

I guess the process involves a percentage that is tax free and then a percentage that isn't ...Is there maybe a pdf that could take me through the steps and costs?

Post by **RobertT** » 20 Jun 2019, 17:03

south London postie wrote:Having settled into the wonderful world of self-harm, I'm sorry self-investment, I am now - just looking - at how feasible it might be to take money from my Zurich account and put in, for example, a regular stocks and shares ISA (I'm quite interested in dabbling in a small way beyond what is on offer via the RM fund options)

I guess the process involves a percentage that is tax free and then a percentage that isn't ...Is there maybe a pdf that could take me through the steps and costs?

The pros of investing into pensions is that you get tax relief on your payments, meaning each £100 net payment from you benefits from another £25 from the taxman. And if you pay into RM pensions(both DB & DC) you not only get tax relief but also salary sacrifice(PSE), meaning each £100 net payment gets you another £47.
And you want to give a chunk of that free money back as soon as you've got it?
Sorry, but I think that's mad!

Whether you can keep taking money out of your RM DC pension to put into an ISA(or anywhere else for that matter) is a question I don't know the answer to I'm afraid. But if you can, you'll need to be at least aged 55 and be willing to pay tax on 75% of it.

However, you may be able to transfer it to another pension arrangement such as a SIPP, which depending on the platform you go for, the investment choices are likely to be very similar to a S&S ISA. Contact Zurich for clarification.

If that isn't an option, why not put in as much into your RM pension to take advantage of tax relief and PSE, that's a big uplift on your money before any investment growth! With anything over going into a SIPP.

Depending on the platform you go for, the investment choices with an S&S ISA and a SIPP are likely to be very similar. But from a tax point of view, a SIPP is the better option going in as long as you don't get hit on the way out, which will involve planning on your part.

south London postie · Post by **south London postie** » 20 Jun 2019, 18:23

Thanks Robert - brilliant information

I understand initial payments into the scheme are highly incentivised, was curious to know what could happen after that. I'm sure you're right; it's best to concentrate on the substantial gains just from being in the scheme, esp. if you take advantage of AVC!

Thanks again :)

Hawkey99 · Post by **Hawkey99** » 20 Jun 2019, 20:30

Just moved some money from RM Growth into RM Shariah.

Reason being Shairah have nearly 70% of holding in USA and in election year old Trump will want his economy to do well.

Any thoughts?

south London postie · Post by **south London postie** » 20 Jun 2019, 20:37

In my heart I know there's no point in two postmen talking about the world economy but I will say one thing; once Brexit is sorted (one way or the other) the £pound will recover, so funds held in £pounds will, at some point, get a decent bounce vs. funds held in $US dollars (pretty sure those are the only choices we have).

I'm looking at that as a safety net in a way; whatever else I do to mess up, at least the £pound bouncing back should mitigate some of my self-inflicted damage .. and assuming Brexit does get sorted !!

On the Sharia Fund - great growth. There is talk of breaking up some tech giants, who really knows ..

k979aaa · Post by **k979aaa** » 20 Jun 2019, 20:59

Become a director in RM lot's of cheep driven down shares with tax exemptions but only 20 people can get them?

heapsy · Post by **heapsy** » 25 Jun 2019, 22:00

RobertT wrote:
south London postie wrote:Having settled into the wonderful world of self-harm, I'm sorry self-investment, I am now - just looking - at how feasible it might be to take money from my Zurich account and put in, for example, a regular stocks and shares ISA (I'm quite interested in dabbling in a small way beyond what is on offer via the RM fund options)

I guess the process involves a percentage that is tax free and then a percentage that isn't ...Is there maybe a pdf that could take me through the steps and costs?
The pros of investing into pensions is that you get tax relief on your payments, meaning each £100 net payment from you benefits from another £25 from the taxman. And if you pay into RM pensions(both DB & DC) you not only get tax relief but also salary sacrifice(PSE), meaning each £100 net payment gets you another £47.
And you want to give a chunk of that free money back as soon as you've got it?
Sorry, but I think that's mad!

Whether you can keep taking money out of your RM DC pension to put into an ISA(or anywhere else for that matter) is a question I don't know the answer to I'm afraid. But if you can, you'll need to be at least aged 55 and be willing to pay tax on 75% of it.

However, you may be able to transfer it to another pension arrangement such as a SIPP, which depending on the platform you go for, the investment choices are likely to be very similar to a S&S ISA. Contact Zurich for clarification.

If that isn't an option, why not put in as much into your RM pension to take advantage of tax relief and PSE, that's a big uplift on your money before any investment growth! With anything over going into a SIPP.

Depending on the platform you go for, the investment choices with an S&S ISA and a SIPP are likely to be very similar. But from a tax point of view, a SIPP is the better option going in as long as you don't get hit on the way out, which will involve planning on your part.

You definitely cannot transfer money held within a pension, to a S & S ISA. A transfer can only take place from one pension to another. I am paying AVCs towards my RM pension. I started late, so I am making up for lost time. As I am single, I am also paying into a S & S ISA. This will give me greater flexibility further down the line. I'm a section C member of the scheme, so don't get the greater benefit that section B provides. However, with my circumstances, I am able to create a more flexible pension that suits my needs.

south London postie · Post by **south London postie** » 25 Jun 2019, 23:19

heapsy wrote: You definitely cannot transfer money held within a pension, to a S & S ISA. A transfer can only take place from one pension to another. I am paying AVCs towards my RM pension. I started late, so I am making up for lost time. As I am single, I am also paying into a S & S ISA. This will give me greater flexibility further down the line. I'm a section C member of the scheme, so don't get the greater benefit that section B provides. However, with my circumstances, I am able to create a more flexible pension that suits my needs.

Very interesting. We have a few things in common. Love the flexibility but .. the money you put in your stocks and shares ISA, is that from your net pay (so after NI and income tax)?

heapsy · Post by **heapsy** » 26 Jun 2019, 00:00

south London postie wrote:
heapsy wrote: You definitely cannot transfer money held within a pension, to a S & S ISA. A transfer can only take place from one pension to another. I am paying AVCs towards my RM pension. I started late, so I am making up for lost time. As I am single, I am also paying into a S & S ISA. This will give me greater flexibility further down the line. I'm a section C member of the scheme, so don't get the greater benefit that section B provides. However, with my circumstances, I am able to create a more flexible pension that suits my needs.
Very interesting. We have a few things in common. Love the flexibility but .. the money you put in your stocks and shares ISA, is that from your net pay (so after NI and income tax)?

Yes. You don't get tax relief with ISAs on the way in. You get it tax free when you sell, or take the income from your investments. Most of my funds are UP by double digit %. One was 44% up when I checked the other day.
22% up across the entire portfolio. think it is worth looking at. I have £40k in total so far. Think about this. If you were retiring tomorrow, what would you do with your lump sum, in a period of very low interest rates for cash deposits?
I am also looking at it as paying myself off. That is, providing extra funds when I've finally had enough. hopefully in 8 years time at 60. Around £45k in AVCs on top. If I get a pay off from RM as well, then I will be quids in. I'm in delivery, and I just can't see myself doing 40 + years tbh.