Cash balance as lump sum in RMPP Nra60.

[sweepster70]

I've just turned 55 and have asked for my figures, more out of curiosity as I plan to take my 60 and 65 pensions at the correct age. Possibly not the new one as I intend to go no later than 65.
With the Final salary, the majority of it is with Capita. There is a small amount held in the RMPP. I always believed that any Cash balance amount would be minimal if payed into the Final salary. According to my figures, I would receive £15,841.92 tax free, of the Final salary pension held in the RMPP.
With the new CDC pension I plan to go at the latest 65, would there be any advantage leaving it in until I get to 67?
Thanks.

[RobertT]

I've just turned 55 and have asked for my figures, more out of curiosity as I plan to take my 60 and 65 pensions at the correct age. Possibly not the new one as I intend to go no later than 65.
With the Final salary, the majority of it is with Capita. There is a small amount held in the RMPP. I always believed that any Cash balance amount would be minimal if payed into the Final salary. According to my figures, I would receive £15,841.92 tax free, of the Final salary pension held in the RMPP.

Which section are you in?

I'm not doubting you, but nearly £16k seems a lot for the DBCBS with Age60. I'd expect more like a 10th of that.
Could it be your standard lump sum(section A/B)?
Or are you giving up some pension to get a lump sum(section C)?

With the new CDC pension I plan to go at the latest 65, would there be any advantage leaving it in until I get to 67?
Thanks.

It won't be reduced for early payment.

[sweepster70]

I'm is section C. This is the small amount in the RMPP.

[RobertT]

I'd expect roughly those amounts from my RMPP Age65 benefits.

[sweepster70]

I do have AVC's but they will help to increase the lump sum of the Capita pension.
I did notice the amount for the cash balance was lower on my figures, as to what it was saying in the 2024 pension statement.

[RobertT]

It seems to me, they've got your Age60 and Age65 figures mixed up in some way, or with some body else? Or they've made some other mistake?

The RMPP sent me quotes for taking my section C pension early(at 56ish) a while back and my figures are totally different to yours.

Obviously everyone's will be different to some degree due to exact wages, pensionable allowances, etc. But mine do tally roughly with the amounts on my annual statements when taken at NRA, and factoring in the early payment reductions.
Although the Cash Balance amount available with Age60 is a massive grey area to me.

Age60.png

Age65.png

[freespeech]

I've just had an estimate through too and I have an option for £16k from DBCBS in my NRA60 quote. The cash balance is also reduced (it's less than the figure from the annual statement late last year). I'm just shy of 59 at present.

[sweepster70]

This is my statement for 2024 and the Final salary addition is £2,332. Adding 10 months increase to this, does it seem to match up with the figures I received? Because this is an addition I don't think it would be affected by taking it early. Would it just increase with time?
If you look at my CSDB pension, it is over £1000 more in the 2024 statement. Is this because my figures are for 55?
I did move from Delivery to Network mid 2012. Could this affect it?

IMG_1372.jpeg

[RobertT]

I think the final salary addition amount in your case, is largely related to your change in job and presumably an increase in your final salary pensionable pay. Although as RMPP are responsible for some inflationary increases on RMSPS benefits, many people will have a small amount.

As the RMPP are responsible for paying that additional Age60 pension, an amount of Cash Balance can also be taken with it.
Using the usual 20x multiple to work out pot value, the tax free lump sum from the Cash Balance with your RMPP Age60 works out as 25% of that particular pot.

The figures on your annual statement are a guide to how much you'll get if you were at NRA on statement date, while the figures in your quote are what you'd get today factoring in any early payment reductions. Those are usually around 5% per year for the pension, although that doesn't seem to apply to your Final Salary Addition.

I've played around with the calculator on the RMPP website and that seems to suggest the Cash Balance is reduced by roughly 1.4% for each year it's taken with Age65 benefits before 65, compared to its value 'today'.
But if you're taking some with RMPP Age60 benefits, I don't think there's a reduction on that element, as in that instance you're taking it 'normally'.

[ebbzie]

WIN_20250221_09_03_52_Pro.jpg

Does this seem right ? 12 years paying in for £65 a year????
I started 02/01/2001

[RobertT]

WIN_20250221_09_03_52_Pro.jpg

Does this seem right ? 12 years paying in for £65 a year????
I started 02/01/2001

Doesn't the accompanying letter explain things?

The RMSPS pay the majority of your Age60 benefits and you should be getting a quote from them aswell. In your case that will be the pension you built up from 2001 to 2010(when Age60 closed to accrual).

Your photo relates to the very small amount of Age60 the RMPP pay.

The RMSPS will also pay some of your Age65, the bit you accrued 2010-2012, and the RMPP pay the other 6 years(2012-2018) plus the DBCBS.

[sweepster70]

I think the final salary addition amount in your case, is largely related to your change in job and presumably an increase in your final salary pensionable pay. Although as RMPP are responsible for some inflationary increases on RMSPS benefits, many people will have a small amount.

As the RMPP are responsible for paying that additional Age60 pension, an amount of Cash Balance can also be taken with it.
Using the usual 20x multiple to work out pot value, the tax free lump sum from the Cash Balance with your RMPP Age60 works out as 25% of that particular pot.

The figures on your annual statement are a guide to how much you'll get if you were at NRA on statement date, while the figures in your quote are what you'd get today factoring in any early payment reductions. Those are usually around 5% per year for the pension, although that doesn't seem to apply to your Final Salary Addition.

I've played around with the calculator on the RMPP website and that seems to suggest the Cash Balance is reduced by roughly 1.4% for each year it's taken with Age65 benefits before 65, compared to its value 'today'.
But if you're taking some with RMPP Age60 benefits, I don't think there's a reduction on that element, as in that instance you're taking it 'normally'.

Thanks Robert,
I do have a basic understanding, but it's always nice to get replies from people who know what they're talking about.

[NWpostie]

It seems to me, they've got your Age60 and Age65 figures mixed up in some way, or with some body else? Or they've made some other mistake?

The RMPP sent me quotes for taking my section C pension early(at 56ish) a while back and my figures are totally different to yours.

Obviously everyone's will be different to some degree due to exact wages, pensionable allowances, etc. But mine do tally roughly with the amounts on my annual statements when taken at NRA, and factoring in the early payment reductions.
Although the Cash Balance amount available with Age60 is a massive grey area to me.

Age60.pngAge65.png

It doesn't look like a lot per year, we've both worked a similar length of time and similar attitude towards savings and pension.

[RobertT]

It seems to me, they've got your Age60 and Age65 figures mixed up in some way, or with some body else? Or they've made some other mistake?

The RMPP sent me quotes for taking my section C pension early(at 56ish) a while back and my figures are totally different to yours.

Obviously everyone's will be different to some degree due to exact wages, pensionable allowances, etc. But mine do tally roughly with the amounts on my annual statements when taken at NRA, and factoring in the early payment reductions.
Although the Cash Balance amount available with Age60 is a massive grey area to me.

Age60.pngAge65.png

It doesn't look like a lot per year, we've both worked a similar length of time and similar attitude towards savings and pension.

The first is only for the RMPP Age60 element, which is going to be fairly minimal for most people. It relates to the purple & lilac boxes on page 2 of your RMPP statement.
Plus it's a quote for taking it 4 years early.

The second is my RMPP Age65 quote reduced for taking it 9 years early. So basically half as much as I'll get at 65.

In practice I have no intention of taking any of my RM pension/s before NRA, which combined will pay out a reasonable sum, supplemented by my personal pension(already in drawdown) and other investments.

[NWpostie]

It seems to me, they've got your Age60 and Age65 figures mixed up in some way, or with some body else? Or they've made some other mistake?

The RMPP sent me quotes for taking my section C pension early(at 56ish) a while back and my figures are totally different to yours.

Obviously everyone's will be different to some degree due to exact wages, pensionable allowances, etc. But mine do tally roughly with the amounts on my annual statements when taken at NRA, and factoring in the early payment reductions.
Although the Cash Balance amount available with Age60 is a massive grey area to me.

Age60.pngAge65.png

It doesn't look like a lot per year, we've both worked a similar length of time and similar attitude towards savings and pension.

The first is only for the RMPP Age60 element, which is going to be fairly minimal for most people. It relates to the purple & lilac boxes on page 2 of your RMPP statement.
Plus it's a quote for taking it 4 years early.

The second is my RMPP Age65 quote reduced for taking it 9 years early. So basically half as much as I'll get at 65.

In practice I have no intention of taking any of my RM pension/s before NRA, which combined will pay out a reasonable sum, supplemented by my personal pension(already in drawdown) and other investments.

Gotcha I thought you already claimed it which is unlike you with your pension advice, if you can hang on until NRA which is all good as 20% and 45% respectively is a lot to lose.

I think I've managed to change my CDC AVC from Lifestyle to Growth via my laptop as the mobile doesn't work with Scottish Widows website too well, I preferred Growth as long term you gain more, there will be dips from time to time, generally the trend is usually higher returns.