Changing Hours Affecting Pension

[celtic1967]

If I were to go part time due to care issues, would the DB part of my pension be affected when I take it in a couple of years ? By this I mean that all the DB pension was built up working full time so would I get full time pension ?

[RobertT]

All of your RMPP pension up to 31st March 2018 is DB. Everything before 31st March 2008 is based on final salary and everything from 1st April 2008 to 31st March 2018 is Career Salary Defined Benefit(CSDB).
They are both forms of Defined Benefit pension, but they're just worked out in different ways!

Take a look at the glossary section of the plan guide you received a few weeks ago and in particular the definitions of pensionable pay. It's available online here if you haven't got your paper copy.

My reading is that the final salary element (upto 31/03/08) is still based on your pay when you leave/take your pension. But the pension you get will be worked out as the best year in the last 3, or the highest average of any three consecutive years in the last 10. So working part time for any length of time may well reduce your FS pension!

However, I don't believe the CSDB(01/04/08 – 31/03/18) will be affected if you reduce your hours.

Perhaps a call to the PSC is in order, to confirm.

Going part time will obviously affect how much 'cash balance' you build up.

[celtic1967]

Thanks Robert, will call them when I get chance

[celtic1967]

I plan on just under three years left

[Hawkey99]

Hi Robert,

If you pay a significant amounts into AVC during my last 3 years and may be retiring shortly, will that reduce my potential amount of pension I receive.

Just thinking that it would make sense not to pay anything into AVCs for 1 of the last 3 years if thats the case.

Any thoughts ?

Thanks

[RobertT]

Thanks Robert, will call them when I get chance

Please post their reply on here, as I'm sure there will be others interested aswell.

[RobertT]

Hi Robert,

If you pay a significant amounts into AVC during my last 3 years and may be retiring shortly, will that reduce my potential amount of pension I receive.

Just thinking that it would make sense not to pay anything into AVCs for 1 of the last 3 years if thats the case.

Any thoughts ?

Thanks

I'm not sure what the relevance is to this thread, but no, paying AVC's doesn't reduce your pension!

Assuming section C(most current RMPP employee members are), AVC's enable you to take a lump sum without commuting any pension to get one.

There are 2 ways your pension could be reduced:

Going part time before you leave RM and/or take your pension.
Drawing your pension/s before NRA.

[Hawkey99]

Hi Robert,

The relevance was you mentioned in the thread that you pension is based on the best of your last 3 years.

I just wondered if you pad a lot into your AVC in these years whether it would reduce your pensionable pay and therefore effect your pension.

Many thanks for your reply as always.

[RobertT]

Hi Robert,

The relevance was you mentioned in the thread that you pension is based on the best of your last 3 years.

I just wondered if you pad a lot into your AVC in these years whether it would reduce your pensionable pay and therefore effect your pension.

Many thanks for your reply as always.

Pensionable pay is made up of your basic pay plus any other pensionable allowances you have, minus the LED(section C).
The only way that would reduce is if you lowered your hours or lost your pensionable allowances.

Paying AVC's does reduce your assessable pay for tax purposes, but it doesn't have any effect on your pensionable pay whatsoever.

[Hawkey99]

Brilliant.

Thats what I was after.

Thank you.