Royal Mail Collective Plan

[Lawrencepa2014]

Where can I find the pension forecast?

[ted_e_bear]

Where can I find the pension forecast?

They're sending info packs in the post it includes the method mentioned in this thread how to log in etc then you can see your plan, mine came Friday so presumably yours should arrive soon.

Here's the plan's website (you can only register when you've received your pack) but there's also further information you could have a look at
https://www.securermcollectiveplan.com/home/

[Blue432]

What happens to your pension plus booster when you die as a single person with grown-up kids?

[RobertT]

What happens to your pension plus booster when you die as a single person with grown-up kids?

My understanding is the same will happen as with benefits held with the RMSPS, RMPP(plus any other DB scheme), a single life annuity or the state pension – they will die with you!

A personal pension scheme can be handed down to family on death, although recent changes to Inheritance Tax might mean some of that could be taxable(depending on total estate value).

There is the option to transfer out your RMCPP benefits to a personal pension, which could enable you to leave it to relatives.

[Blue432]

What happens to your pension plus booster when you die as a single person with grown-up kids?

My understanding is the same will happen as with benefits held with the RMSPS, RMPP(plus any other DB scheme), a single life annuity or the state pension – they will die with you!

A personal pension scheme can be handed down to family on death, although recent changes to Inheritance Tax might mean some of that could be taxable(depending on total estate value).

There is the option to transfer out your RMCPP benefits to a personal pension, which could enable you to leave it to relatives.

Thanks for your reply.

So I can transfer out the Collective Plan and Scottish Widows as well to a personal pension? And will all what I’ve contributed so far be transferred?

[RobertT]

What happens to your pension plus booster when you die as a single person with grown-up kids?

My understanding is the same will happen as with benefits held with the RMSPS, RMPP(plus any other DB scheme), a single life annuity or the state pension – they will die with you!

A personal pension scheme can be handed down to family on death, although recent changes to Inheritance Tax might mean some of that could be taxable(depending on total estate value).

There is the option to transfer out your RMCPP benefits to a personal pension, which could enable you to leave it to relatives.

Thanks for your reply.

So I can transfer out the Collective Plan and Scottish Widows as well to a personal pension? And will all what I’ve contributed so far be transferred?

It sounds like you were previously paying into the RM Defined Contribution Plan?
If so, that money will already be part of your estate if you were to die. You don't have to transfer that for estate planning purposes.

But if you were to convert your pot into an annuity(income for life) when you retire, that would die with you unless you have one with a guarantee period. In which case the remaining guaranteed years of payments would still be paid out.

You can transfer all 3 elements of the RMCPP - pension, lump sum(inc booster) & AVC's(if you pay them). But you won't be able to do that until after you've stopped paying in and before you start drawing them.

More details of that are in the Handbook, available on the RMCPP website.

[Blue432]

What happens to your pension plus booster when you die as a single person with grown-up kids?

My understanding is the same will happen as with benefits held with the RMSPS, RMPP(plus any other DB scheme), a single life annuity or the state pension – they will die with you!

A personal pension scheme can be handed down to family on death, although recent changes to Inheritance Tax might mean some of that could be taxable(depending on total estate value).

There is the option to transfer out your RMCPP benefits to a personal pension, which could enable you to leave it to relatives.

Thanks for your reply.

So I can transfer out the Collective Plan and Scottish Widows as well to a personal pension? And will all what I’ve contributed so far be transferred?

It sounds like you were previously paying into the RM Defined Contribution Plan?
If so, that money will already be part of your estate if you were to die. You don't have to transfer that for estate planning purposes.

But if you were to convert your pot into an annuity(income for life) when you retire, that would die with you unless you have one with a guarantee period. In which case the remaining guaranteed years of payments would still be paid out.

You can transfer all 3 elements of the RMCPP - pension, lump sum(inc booster) & AVC's(if you pay them). But you won't be able to do that until after you've stopped paying in and before you start drawing them.

More details of that are in the Handbook, available on the RMCPP website.

I’ll leave Scottish Widows as is then, and transfer out of the RMCPP into a personal plan. Is there a certain type of plan I should go for which guarantees a lump sum for adult offspring when I die? Also, who, in your opinion, is a reputable provider?

[RobertT]

I’ll leave Scottish Widows as is then, and transfer out of the RMCPP into a personal plan. Is there a certain type of plan I should go for which guarantees a lump sum for adult offspring when I die? Also, who, in your opinion, is a reputable provider?

Just having the money in a personal pension will mean it will be part of your estate when you die.

Although as stated, if you've already bought an annuity when you die, the terms of that might dictate how much is left to your offspring.

Or if you do drawdown instead, the remaining balance will be inherited.

There's loads of personal pension providers out there, all providing similar services.

[stevejm]

You also have the option of taking a cash value instead of the pension for life, and transferring to a personal pension.
See the RMCPP website for details...

I don't know exactly how that will be worked out, but it'll be your share of the overall pot at the time.

If you assume your annual pension will be paid out for life, and an average 67 year old man is expected to live to around 82, then a simple multiplication should give you a rough idea of how much the transfer value will be.

Add that to the RMDCP pot you already have!

It might be worth pointing out that if you plan to withdraw all of your RMDCP pot(and any transferred in cash) in one go, you'll lose quite a lot in tax.
Assuming no other income in that particular tax year, a £140k pot would take a £30k tax hit!

Robert, so if I don't want a 'sum for life' is there a way of taking the money in that pot and getting it paid out directly to me at retirement age? Transferring it to a private personal pension would surely be costly what with the management fees of the new personal pension?
What's your opinion? Shouldn't there be more flexibility built into the Collective Plan so members could at a minimum choose to have all their contributions paid into the lump sum pot or alternatively the income for life pot?

[RobertT]

You also have the option of taking a cash value instead of the pension for life, and transferring to a personal pension.
See the RMCPP website for details...

I don't know exactly how that will be worked out, but it'll be your share of the overall pot at the time.

If you assume your annual pension will be paid out for life, and an average 67 year old man is expected to live to around 82, then a simple multiplication should give you a rough idea of how much the transfer value will be.

Add that to the RMDCP pot you already have!

It might be worth pointing out that if you plan to withdraw all of your RMDCP pot(and any transferred in cash) in one go, you'll lose quite a lot in tax.
Assuming no other income in that particular tax year, a £140k pot would take a £30k tax hit!

Robert, so if I don't want a 'sum for life' is there a way of taking the money in that pot and getting it paid out directly to me at retirement age? Transferring it to a private personal pension would surely be costly what with the management fees of the new personal pension?

You transfer it, keep it in there for a minimal time, then take it as cash if that's what you want to do.
You'll be able to do that any time after age 55, rising to 57 in 2028.

Although if you do decide to take all your pot in one go, you'll likely lose a fair whack to the taxman.
Using drawdown is a far more tax efficient method.

Charges vary with the provider and the investments you chose.

What's your opinion? Shouldn't there be more flexibility built into the Collective Plan so members could at a minimum choose to have all their contributions paid into the lump sum pot or alternatively the income for life pot?

There is flexibility if you transfer out!

[stevejm]

You also have the option of taking a cash value instead of the pension for life, and transferring to a personal pension.
See the RMCPP website for details...

I don't know exactly how that will be worked out, but it'll be your share of the overall pot at the time.

If you assume your annual pension will be paid out for life, and an average 67 year old man is expected to live to around 82, then a simple multiplication should give you a rough idea of how much the transfer value will be.

Add that to the RMDCP pot you already have!

It might be worth pointing out that if you plan to withdraw all of your RMDCP pot(and any transferred in cash) in one go, you'll lose quite a lot in tax.
Assuming no other income in that particular tax year, a £140k pot would take a £30k tax hit!

Robert, so if I don't want a 'sum for life' is there a way of taking the money in that pot and getting it paid out directly to me at retirement age? Transferring it to a private personal pension would surely be costly what with the management fees of the new personal pension?

You transfer it, keep it in there for a minimal time, then take it as cash if that's what you want to do.
You'll be able to do that any time after age 55, rising to 57 in 2028.

Although if you do decide to take all your pot in one go, you'll likely lose a fair whack to the taxman.
Using drawdown is a far more tax efficient method.

Charges vary with the provider and the investments you chose.

What's your opinion? Shouldn't there be more flexibility built into the Collective Plan so members could at a minimum choose to have all their contributions paid into the lump sum pot or alternatively the income for life pot?

There is flexibility if you transfer out!

Thank you Robert

[Blue432]

I’ll leave Scottish Widows as is then, and transfer out of the RMCPP into a personal plan. Is there a certain type of plan I should go for which guarantees a lump sum for adult offspring when I die? Also, who, in your opinion, is a reputable provider?

Just having the money in a personal pension will mean it will be part of your estate when you die.

Although as stated, if you've already bought an annuity when you die, the terms of that might dictate how much is left to your offspring.

Or if you do drawdown instead, the remaining balance will be inherited.

There's loads of personal pension providers out there, all providing similar services.

Would Nest be a good option to transfer to from RMCPP?

[RobertT]

I’ll leave Scottish Widows as is then, and transfer out of the RMCPP into a personal plan. Is there a certain type of plan I should go for which guarantees a lump sum for adult offspring when I die? Also, who, in your opinion, is a reputable provider?

Just having the money in a personal pension will mean it will be part of your estate when you die.

Although as stated, if you've already bought an annuity when you die, the terms of that might dictate how much is left to your offspring.

Or if you do drawdown instead, the remaining balance will be inherited.

There's loads of personal pension providers out there, all providing similar services.

Would Nest be a good option to transfer to from RMCPP?

Nest pensions are specifically workplace schemes set up by employers.

It's not possible to set one up yourself, but if you already have one from another job, you can continue paying in and also transfer other similar pensions into it.

Their charges are quite high compared to others and they have a very small choice of investments.

This is what Unbiased says about them(other opinions are available): https://www.unbiased.co.uk/discover/pen ... is-it-good

Some people might recommend a pension provider, but as there's so many to choose from and because they all provide basically the same thing, ultimately who you go for will be a personal choice.
I can only suggest you do some homework and try to find one you're happy with.

There are a few pension comparison sites which might help you.

[Blue432]

I’ll leave Scottish Widows as is then, and transfer out of the RMCPP into a personal plan. Is there a certain type of plan I should go for which guarantees a lump sum for adult offspring when I die? Also, who, in your opinion, is a reputable provider?

Just having the money in a personal pension will mean it will be part of your estate when you die.

Although as stated, if you've already bought an annuity when you die, the terms of that might dictate how much is left to your offspring.

Or if you do drawdown instead, the remaining balance will be inherited.

There's loads of personal pension providers out there, all providing similar services.

Would Nest be a good option to transfer to from RMCPP?

Nest pensions are specifically workplace schemes set up by employers.

It's not possible to set one up yourself, but if you already have one from another job, you can continue paying in and also transfer other similar pensions into it.

Their charges are quite high compared to others and they have a very small choice of investments.

This is what Unbiased says about them(other opinions are available): https://www.unbiased.co.uk/discover/pen ... is-it-good

Some people might recommend a pension provider, but as there's so many to choose from and because they all provide basically the same thing, ultimately who you go for will be a personal choice.
I can only suggest you do some homework and try to find one you're happy with.

There are a few pension comparison sites which might help you.

Thanks for all of your advice - there’s certainly a lot of reading-up to do…

[Dexydog]

From what I can see, NEST allows drawdown of your workplace one but NOT any other pensions you transfer into it.
So if you transfer your RMCPP into it you're probably stuck with an annuity as the only way to access it unless you take the lot and pay any tax due.
RobertT may well have a better interpretation.