Royal Mail pension news and discussion.Please note the advise given in this forum is unofficial, please use the links we have for a more detailed response or see an independent financial adviser.
I wish I'd gone down the AVC route years ago .... but I didn't even have a decent PC then, and I'd never heard of RMC!
Instead I started putting about £100 a month into a PPP (it was index linked at 2.5%ish).... I'm not as pension savvy as some contributors.
At the time my main concern was to have a seperate nest egg that the Missus didn't know about (we were going through one of those Bad Marriage times ... PS we're still together) Also I basically didn't trust RM, and didn't want all my eggs in one basket. We all know what happens when people like Philip Green & Robert Maxwell are in charge.
I reckon I've probably got another 7 or 8 years to push. Gut Feeling says "Leave it where it is" (I've been paying in about 14 years), but would there be any advantage with these new RM pensions to moving it across (that's if it's possible)?
Assuming you're in the RMPP(sections A, B or C), then AVC's have always been invested in funds which are totally separate from the main RM pension. There's been quite a few providers over the years, with the latest being Scottish widows.
Their main aim is to provide a tax free lump sum when taking your main NRA60/65 benefits. Particularly useful for section C'ers who don't get a lump sum as standard.
It's not possible to transfer money from any other pension into the RMPP or AVC's(Flexiplan & Bonusplan).
so if i rang up next week and changed it to £100 i would automatically get the pse benefit?
Yes, you should do!
is it clear when reading your payslip if you are achieving a 68p to £1 gain or an 80p to £1 gain?
No it isn't, but it isn't clear that you also receive that gain on your normal pension contributions either!
Based on £100 per week gross contribution, your income tax bill will reduce by £20 and your NIC's by £12. Meaning your take home pay will only reduce by £68.
That's based on a 'normal week' - it could be more difficult to work out when factoring in different amounts of OT, etc.
Plus all of your pension contributions should be on the left hand side of the page and be minus amounts.
Last edited by RobertT on 28 Mar 2021, 14:32, edited 1 time in total.
Assuming you're in the RMPP(sections A, B or C), then AVC's have always been invested in funds which are totally separate from the main RM pension. There's been quite a few providers over the years, with the latest being Scottish widows.
Their main aim is to provide a tax free lump sum when taking your main NRA60/65 benefits. Particularly useful for section C'ers who don't get a lump sum as standard.
It's not possible to transfer money from any other pension into the RMPP or AVC's(Flexiplan & Bonusplan).
Thanks for the prompt reply RobertT.... informative as ever. That's just one less decision to make in this world of endles possibilities.
Like all Wage Slaves, he had two crosses to bear: The people he worked for and the people he worked with! (Stephen Vizinczey.)
you are right decky , ive just seen the latest payslip online and now the pension avc and 6% are both on the right.
looks like i need to reduce it to maybe 10 or 20% instead of the £200
HI, basic pay for 35hrs (London) =£495 , if I pay £180pw AVC this reduces the basic to £315 divided by 35 = £9 per hour, so should this amount still not qualify for the PSE 12% NI deduction benefit? or am I doing something wrong with my calculation. The hourly rate would still be above the national minimum wage if its £8.91p.
HI, basic pay for 35hrs (London) =£495 , if I pay £180pw AVC this reduces the basic to £315 divided by 35 = £9 per hour, so should this amount still not qualify for the PSE 12% NI deduction benefit? or am I doing something wrong with my calculation. The hourly rate would still be above the national minimum wage if its £8.91p.
You are forgetting your normal pension payments and any other payments that you may make under salary sacrifice. You will be paying almost £30 at 6% in basic pension contributions.
im currently paying 6% but thinking to increase it due to the cdc scheme taking over.
i worked out:
our hourly rate 11.93 min wage 8.91
difference £3 x 38 = £114 the max i can pay in each week?
which is roughly 25% plus the employers 10% totalling 35%
am i correct?
Don't forget we're getting another 1% pay rise at the end of April, meaning the theoretical maximum AVC amount would go up another £5 from £114 to £119 for a full timer.
OT is pensionable for part time members of the RMDCP, but only on OT that takes them up to full time hours.
Also I basically didn't trust RM, and didn't want all my eggs in one basket. We all know what happens when people like Philip Green & Robert Maxwell are in charge.
That's just one less decision to make in this world of endles possibilities. 
