Started RM in 2013 and I will shortly be leaving in March to work for the Council who have LGPS so I'd like to get that up and running as soon as I can.
What's the best scenario for my current pension that I've paid into for 12 years, is it normal or possible to transfer it or just leave it and start a new pension with the council?
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Leaving RM for the Council.
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postiewhite
- EX ROYAL MAIL
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RobertT
- EX ROYAL MAIL
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Re: Leaving RM for the Council.
If you started RM in 2013 you'll be in the RM Defined Contribution Plan with Scottish Widows, but you may have opted to pay into the DBCBS(section F) instead sometime after April 2018?
The RMDCP is a pot of cash with options – usually either drawdown or annuity.
Section F members of the DBCBS can either take all their pot as cash in full with the first 25% being tax free, or transfer into a personal pension for the same options as above(pending the £30k advice rule).
The LGPS is a different kind of scheme. It's defined benefit and provides a pension based on your salary for each year you're employed, and is similar to the scheme RM offered to section A, B & C members between 2008 & 2018 – sometimes known as a career average pension.
The difference is that the LGPS is worked out as 1/49 of your pensionable pay, while RM's was 1/60(section C) & 1/80(section A/B), meaning the LGPS has a better accrual rate, although it's normal retirement age is your state pension age, with the choice to take it earlier with a reduction.
It's possible to transfer other pensions into the LGPS and your cash will buy a certain number of years in your new scheme. But in doing so you'll be giving up the flexibility you have with your other scheme/s.
If you leave the RMDCP where it is, it will continue to be invested in the fund/s you choose until you decide to access it, which is a minimum age of 55, rising to 57 in 2028.
If you have any DBCBS that will continue to increase with discretionary rises each year until you access it.
For more info on the LGPS is here: https://www.lgpsmember.org/your-pension ... orked-out/
The RMDCP is a pot of cash with options – usually either drawdown or annuity.
Section F members of the DBCBS can either take all their pot as cash in full with the first 25% being tax free, or transfer into a personal pension for the same options as above(pending the £30k advice rule).
The LGPS is a different kind of scheme. It's defined benefit and provides a pension based on your salary for each year you're employed, and is similar to the scheme RM offered to section A, B & C members between 2008 & 2018 – sometimes known as a career average pension.
The difference is that the LGPS is worked out as 1/49 of your pensionable pay, while RM's was 1/60(section C) & 1/80(section A/B), meaning the LGPS has a better accrual rate, although it's normal retirement age is your state pension age, with the choice to take it earlier with a reduction.
It's possible to transfer other pensions into the LGPS and your cash will buy a certain number of years in your new scheme. But in doing so you'll be giving up the flexibility you have with your other scheme/s.
If you leave the RMDCP where it is, it will continue to be invested in the fund/s you choose until you decide to access it, which is a minimum age of 55, rising to 57 in 2028.
If you have any DBCBS that will continue to increase with discretionary rises each year until you access it.
For more info on the LGPS is here: https://www.lgpsmember.org/your-pension ... orked-out/
Links to all RM pension related websites are here