RMSPS + RMPP + ?

[billintights]

Hi there. I joined Royal Mail in January 1989 and signed up to the pension scheme right away. I'm now 56 and recently requested a quotation of my pension if I was to take benefits early. I received quotations from RMSPS (Capita) and RMPP. However, several people in my workplace have insisted that there is a third part to the pension - some have called it a cash builder or a cash balance fund - possibly administered by Scottish Widows. When I rang the RM pensions helpline I was told I was not a member of this scheme. Who's right here? Are my colleagues mistaken? Is the cash balance fund actually a part of RMPP? Were the helpline correct? And if so, have I somehow managed to opt out of something I should have remained a member of? I'm confused.

I confess to having no head for financial matters and to having paid little attention to my pension over the years, so any help or clarification would be greatly appreciated. Many thanks.

[freespeech]

Hi there. I joined Royal Mail in January 1989 and signed up to the pension scheme right away. I'm now 56 and recently requested a quotation of my pension if I was to take benefits early. I received quotations from RMSPS (Capita) and RMPP. However, several people in my workplace have insisted that there is a third part to the pension - some have called it a cash builder or a cash balance fund - possibly administered by Scottish Widows. When I rang the RM pensions helpline I was told I was not a member of this scheme. Who's right here? Are my colleagues mistaken? Is the cash balance fund actually a part of RMPP? Were the helpline correct? And if so, have I somehow managed to opt out of something I should have remained a member of? I'm confused.

I confess to having no head for financial matters and to having paid little attention to my pension over the years, so any help or clarification would be greatly appreciated. Many thanks.

The cash balance fund will be on your annual pension statement. It's part of the schemes you are in.

[moles40]

These pensions are so confusing why it can't all fall under one company is beyond me.

From what I have been told you have a cash builder pension from Scottish Widows which you can withdraw as cash if you are 55 or over of course to add to your lump sum from the other pension,if you are taking pension. It's around 18k if your on postman wages.

[billintights]

The cash balance fund will be on your annual pension statement. It's part of the schemes you are in.

So it's on the annual statements rather than on the quotes I was sent? Thanks, I'll dig out the paperwork.

[billintights]

From what I have been told you have a cash builder pension from Scottish Widows which you can withdraw as cash if you are 55 or over of course to add to your lump sum from the other pension,if you are taking pension. It's around 18k if your on postman wages.

Yes, that's similar to what I've heard from a couple of colleagues. I guess the amount is more-or-less consistent for anyone of operational grade whose been in the business since 2018?

[RobertT]

Hi there. I joined Royal Mail in January 1989 and signed up to the pension scheme right away. I'm now 56 and recently requested a quotation of my pension if I was to take benefits early. I received quotations from RMSPS (Capita) and RMPP. However, several people in my workplace have insisted that there is a third part to the pension - some have called it a cash builder or a cash balance fund - possibly administered by Scottish Widows. When I rang the RM pensions helpline I was told I was not a member of this scheme. Who's right here? Are my colleagues mistaken? Is the cash balance fund actually a part of RMPP? Were the helpline correct? And if so, have I somehow managed to opt out of something I should have remained a member of? I'm confused.

I confess to having no head for financial matters and to having paid little attention to my pension over the years, so any help or clarification would be greatly appreciated. Many thanks.

The Defined Benefit Cash Balance Scheme(DBCBS) is what section A, B & C members of the RMPP have been building up since 2018, when the pension scheme itself closed to future accrual. It's a lump sum which you can take predominantly with your NRA65(2010-2018) benefits. But you can also transfer it out to another pension scheme if you wish.

If you don't know which section, or pension, you're in, just check your wage slip. In your case it should say – PSE Adj RMPP DBCBS C. Unless you have managed to opt out at some point?

When applying for a pension quote, for some reason the DBCBS is not included in the initial figures! It's only when you say you want to take the next step that they're then calculated and communicated to you.

But as has been said, you can get some idea from your RMPP annual statement. Your latest one from 2021 represents 3 years worth of DBCBS, so with a bit of basic maths, it shouldn't be too difficult to guestimate what it might be worth today.

To work out a more accurate figure you'll have to take into account the latest annual increase of 4.6% plus the exact 19.6% of your pensionable pay that's gone in since 31st March 2021.

More details are on the RMPP website: https://www.royalmailpensionplan.co.uk/

The DBCBS is not to be confused with the RM Defined Contribution Plan which is administered by Scottish Widows. Which is a scheme for those who joined RM from 2008, or else those who've either already taken all of their RMSPS/RMPP benefits, or opted out of those schemes altogether.

RMDCP details are here: https://www.scottishwidows.co.uk/save/royalmaildcplan/


*RMPP members also have the option to pay AVC's into Bonusplan and/or Flexiplan which are also managed by Scottish Widows.

*RMDCP members with at least 5 years in that scheme have the choice to then join the RMPP/DBCBS(section F) instead.

[Schiff]

Robert.

As our resident pensions expert on these boards you seem to spend quite a bit of your time explaining to different people which pension schemes they are likely to have contributed to and when and how they can claim them (and you do this far better than the official bumph).

I wonder if it would be worth producing a single post explaining this and then asking admin to make this a sticky at the top of the board that people can refer to as, at the moment, your excellent advice soon disappears from the front page which makes it more difficult for people to find the answer to their personal situation so they need to post a brand new query each time.

[billintights]

The Defined Benefit Cash Balance Scheme(DBCBS) is what section A, B & C members of the RMPP have been building up since 2018, when the pension scheme itself closed to future accrual. It's a lump sum which you can take predominantly with your NRA65(2010-2018) benefits. But you can also transfer it out to another pension scheme if you wish.

If you don't know which section, or pension, you're in, just check your wage slip. In your case it should say – PSE Adj RMPP DBCBS C. Unless you have managed to opt out at some point?

When applying for a pension quote, for some reason the DBCBS is not included in the initial figures! It's only when you say you want to take the next step that they're then calculated and communicated to you.

But as has been said, you can get some idea from your RMPP annual statement. Your latest one from 2021 represents 3 years worth of DBCBS, so with a bit of basic maths, it shouldn't be too difficult to guestimate what it might be worth today.

To work out a more accurate figure you'll have to take into account the latest annual increase of 4.6% plus the exact 19.6% of your pensionable pay that's gone in since 31st March 2021.

More details are on the RMPP website: https://www.royalmailpensionplan.co.uk/

The DBCBS is not to be confused with the RM Defined Contribution Plan which is administered by Scottish Widows. Which is a scheme for those who joined RM from 2008, or else those who've either already taken all of their RMSPS/RMPP benefits, or opted out of those schemes altogether.

RMDCP details are here: https://www.scottishwidows.co.uk/save/royalmaildcplan/


*RMPP members also have the option to pay AVC's into Bonusplan and/or Flexiplan which are also managed by Scottish Widows.

*RMDCP members with at least 5 years in that scheme have the choice to then join the RMPP/DBCBS(section F) instead.

Thanks you so much! That's the clearest and most comprehensive explanation I've heard from anyone. I feel I'm finally getting to grips with how the various elements fit together.

[billintights]

Robert.

As our resident pensions expert on these boards you seem to spend quite a bit of your time explaining to different people which pension schemes they are likely to have contributed to and when and how they can claim them (and you do this far better than the official bumph).

I wonder if it would be worth producing a single post explaining this and then asking admin to make this a sticky at the top of the board that people can refer to as, at the moment, your excellent advice soon disappears from the front page which makes it more difficult for people to find the answer to their personal situation so they need to post a brand new query each time.

I'd definitely second that! Would've been a great help and would help prevent the thread getting clogged with people asking similar questions over and over.

[RobertT]

I like to help if I can, but I also try and persuade people to help themselves too by directing them to relevant websites for additional reading.

A sticky has crossed my mind before, although it probably wouldn't be all encompassing due to all the various sections and schemes. They'll always be a few permutations that aren't covered!
Plus I'm not sure many people take much notice of the stickies that already exist.

I might come up with something in due course and pm it to an admin and see what they say. It'll keep me busy on a wet Sunday afternoon.

[Trumanity]

Robert.

As our resident pensions expert on these boards you seem to spend quite a bit of your time explaining to different people which pension schemes they are likely to have contributed to and when and how they can claim them (and you do this far better than the official bumph).

I wonder if it would be worth producing a single post explaining this and then asking admin to make this a sticky at the top of the board that people can refer to as, at the moment, your excellent advice soon disappears from the front page which makes it more difficult for people to find the answer to their personal situation so they need to post a brand new query each time.

I agree with you, Schiff. However, please be careful with the word advice. Correct technical information, yes. But not advice.

[paul gallon]

RoberT could you please advise if I was to retire this year at 59 would I lose approximately 5 percent per year as regarding DBCBS and would any amount be taxable: Thanks for any help you can give