DBCBS NRA60

[freespeech]

I know most of the cash balance scheme is for NRA65 but I saw a post earlier this week that also said that in terms of NRA60 only the RMPP plan part can access the DBCBS. I'm trying to work out what % of the overall cash scheme I can use for NRA60. Any thoughts?

[RobertT]

The same question was asked by someone else an another thread an hour before you:

viewtopic.php?p=982028#p982028

[freespeech]

Thanks Robert.......I suspect we may well end up paying into the Cash Balance scheme until March 2023 so two more years more than shown on current statements. A lot are going to get hit hard with tax. I'm wondering whether to reduce or cease my current AVC's as they are just contributing to the problem aren't they (ie funding the LS and maintaining a higher pension)?

[RobertT]

It depends on how much is in your AVC's. But yes, the more you have in both AVC's and DBCBS, the more tax is likely to be an issue.

Personally I've built up a healthy sum in AVC's, more than the 25% tax free amount.
If I take all of that cash with my NRA60/65 benefits I'll probably end up paying 40% tax on some of it, even without the DBCBS.

But I can get around that by transferring out my Bonusplan to help retirement before 60, and then transfer my excess Flexiplan once I've taken my NRA60(inc 25% tax free from AVC's), but before taking NRA65.

Therefore I'll be drawing down the transferred money over time, rather than getting it in one lump sum. I'll still pay 20% on some of it, but will avoid the 40% rate.