Anyone leaving the pension scheme?

[silver_fox]

I was quite happy with the RMDCP but don’t like what I know about the new collective one and the nest option has much lower employer contributions.
How much longer do you think we have in the RMDCP?
Is anyone considering exiting altogether?

[Dindin]

I'm thinking of leaving it

[aiden01]

I'm thinking of leaving it

Why???

[RobertT]

I was quite happy with the RMDCP but don’t like what I know about the new collective one and the nest option has much lower employer contributions.
How much longer do you think we have in the RMDCP?

The consultation period ends on 21st November and they will presumably spend a bit of time perusing the feedback and possibly making a few changes.
They've said they'll send out more info 3 months before implementation date.

It sounds to me as if they're aiming for April 2022. But we'll have to wait and see.

Is anyone considering exiting altogether?

I can understand people being wary of the collective scheme and preferring DC, and so I can understand them being miffed at the lower contributions into Nest.
But there are other options worth considering with RMCPP, such as taking advantage of the money and transferring out at a later date.

Opting out of any workplace pension completely is kicking yourself in the balls!

[Tman]

...And then getting your mate to repeat it until his leg gets tired.
Why would anyone even think or suggest leaving the scheme?

[badger1]

I left the pension plan last month and new plan has much better investment options and already done very well. You get 20% back from the taxman too. CDC is not for me, you really have to work til 67 to get the most from it, not for me! I know Robert is a huge fan and won’t hear a word against cdc , but I feel we should have had the option of remaining in the current scheme and not bullied into cdc.
Royal Mail invest so poorly you can get so much elsewhere that well outweighs RMs contributions. I’m not saying I’m right but it’s not black and white. As in the plan is good out is bad.
If a plan is that great like they claim cdc is then you should want to join, not be forced to.

[yubin282]

I'm not sure I like the new scheme, also I don't want to work until I'm 67 or reallistically 70+

[RobertT]

I left the pension plan last month and new plan has much better investment options and already done very well. You get 20% back from the taxman too. CDC is not for me, you really have to work til 67 to get the most from it, not for me! I know Robert is a huge fan and won’t hear a word against cdc , but I feel we should have had the option of remaining in the current scheme and not bullied into cdc.
Royal Mail invest so poorly you can get so much elsewhere that well outweighs RMs contributions. I’m not saying I’m right but it’s not black and white. As in the plan is good out is bad.
If a plan is that great like they claim cdc is then you should want to join, not be forced to.

I wouldn't say I'm a huge fan, but in my opinion it's the best option and represents a genuine attempt to provide a pension for life, rather than just a pot of money.
I try to answer questions as best i can!

I think to get the most out of CDC you have to take it at 67, not necessarily work until 67!

CDC aims to provide similar benefits to a DB scheme – a lump sum and an income for life, albeit one that can go up and down.

An individual DC pension has obviously got other choices.
Personally I think the annuity option is a poor choice and you're probably likely to get a better deal with CDC. But drawdown is better suited for early retirement or to supplement your income until state pension age, as long a you've got a decent guaranteed income afterwards.

Which is where I think those who've already got a decent DC pot tucked away, are slightly missing the point. In my opinion anyway, for what it's worth.
You drawdown the DC pot and retire or at least semi-retire at 60 ish and you've still got your CDC and state pension to look forward to.

But as ever individual circumstances will decide....

It's personal choice at the end of the day! But as far as the contributions are concerned, I expect my weekly paymentss to be around £19 net once tax relief and PSE have been factored in, which represents another £8 or so from the taxman. On top of that I'll have £62 from RM.

So given the choice of having £90 going into CDC or £19(plus tax relief) going into my own DC pension, I know what I'd choose.
Straight away I'd lose the benefit of salary sacrifice so my money would need to nearly quadruple in value before it even matched what's going into CDC.

Good luck with your individual choices.

[RobertT]

I'm not sure I like the new scheme, also I don't want to work until I'm 67 or reallistically 70+

But how long will you be working until if you don't join?

[silver_fox]

Hi badger which plan have you joined?

[badger1]

I do mine through Hargreaves Lansdown, have a great choice of funds.
Fees are very competitive too.
Had a meeting at work today amongst ourselves and a lot against the new pension plan, most common question was why can’t we choose to stay in current plan

[RobertT]

I do mine through Hargreaves Lansdown, have a great choice of funds.
Fees are very competitive too.
Had a meeting at work today amongst ourselves and a lot against the new pension plan, most common question was why can’t we choose to stay in current plan

The RMCPP isn't due to start until next year and you've already stopped paying into your RM pension?
Is that the RMPP or RMDCP?
You want to completely say no to RM's contributions plus the extra benefit of PSE?
Not even Nest?

I'm all for people saving extra away from RM if it helps them retire earlier, I've done it myself with a decent amount of success – I'll be retiring earlier than most!
But giving up substantial amounts of money isn't really going to help, especially when you have the ability to take advantage of that money and then transfer.

I can understand those wanting to stay in the RMDCP at current rates, but the DBCBS was only ever a transitional scheme and becomes less tax efficient as time goes by, so the longer that stays open the more is going to the taxman.

[yubin282]

I do mine through Hargreaves Lansdown, have a great choice of funds.
Fees are very competitive too.
Had a meeting at work today amongst ourselves and a lot against the new pension plan, most common question was why can’t we choose to stay in current plan

How does it work with Hargreaves Lansdown is it a SIPP?

Or is it essentially your own pot of money to work with? What's the difference?

I've got my own investments with them, COVID was pretty good for funds if you invested right at the beginning of the pandemic (at least it was for me).

[RobertT]

I have an equity ISA with HL and their SIPP is very similar, other than the obvious pension rules that apply.
The only difference between a SIPP and any other DC pension, is the SIPP will usually have a much bigger choice of investments.

HL aren't the cheapest for charges but personally I like their platform and my investments have done well over the years.

Although giving up the free money you get from at least joining the Nest scheme doesn't make any sense to me. You can have as many pensions as you want, so assuming money allows, why not consider doing both?

You pay into a personal pension and you get another 25% added on in tax relief.

In RM pensions you also get the benefit of PSE, which adds 47% onto your net payment.

If you join Nest you get the extra 3% RM contribution plus tax relief and PSE, which adds 135% onto your net payment.

With CDC it's 13.6% from RM, tax relief & PSE, which equates to a 380% increase on your money.

All that is before any investment growth.

The rule with company pensions is always join and always pay in whatever it takes to get the maximum employer contribution. I don't really see why that would be different with CDC.

[yubin282]

I have an equity ISA with HL and their SIPP is very similar, other than the obvious pension rules that apply.
The only difference between a SIPP and any other DC pension, is the SIPP will usually have a much bigger choice of investments.

HL aren't the cheapest for charges but personally I like their platform and my investments have done well over the years.

Although giving up the free money you get from at least joining the Nest scheme doesn't make any sense to me. You can have as many pensions as you want, so assuming money allows, why not consider doing both?

You pay into a personal pension and you get another 25% added on in tax relief.

In RM pensions you also get the benefit of PSE, which adds 47% onto your net payment.

If you join Nest you get the extra 3% RM contribution plus tax relief and PSE, which adds 135% onto your net payment.

With CDC it's 13.6% from RM, tax relief & PSE, which equates to a 380% increase on your money.

All that is before any investment growth.

The rule with company pensions is always join and always pay in whatever it takes to get the maximum employer contribution. I don't really see why that would be different with CDC.

Thanks, yeah I was thinking about joining the new one and nest, the RMDCP i'll probably join a SIPP with Hl.