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Does anyone understand the new pension at all? I can't make head nor tail of it can someone explain it like the simpleton I clearly am? I get that 1/80th is a yearly sum, but my maths is £550 a week x 52 which equals £28,600. So times that by 30 is £858,000 divided by the magic 1/80th is £10,725.
Am I getting £10k a year as a pension from RM on top of my state pension whatever that may be? Doesn't feel like a lot but
£505 (weekly basic pay divided by 80) = £6.31 x 52 weeks x 20 years. This would give £126 per week or £6565 per year. Lump sump would be £6565 x 3 = £19695
This is based without inflation or payrises.
With an average inflation/payrise of 2%. If you contribute from now for the next 20 years. It will be more like this.
And that's not guaranteed as they've admitted it may vary even after retirement
Yeah, some of the wording in the online booklet is worrying. Makes it’s sound like a glorified Ponzi scheme. The CWU have approved it so it must be brilliant
£505 (weekly basic pay divided by 80) = £6.31 x 52 weeks x 20 years. This would give £126 per week or £6565 per year. Lump sump would be £6565 x 3 = £19695
This is based without inflation or payrises.
With an average inflation/payrise of 2%. If you contribute from now for the next 20 years. It will be more like this.
£176 per week
£9152 per year
£27546 lump sum.
I currently pay £155 per week & will have 5 years to retirement from October.
Using the same calculation comes up with the following,
£155 x 52 weeks x 5 years = £775 per week or £40300 per year. Lump sum would be £40300 x 3 = £120600. Someone correct me & bring me back down to earth before I order the Porsche.
And that's not guaranteed as they've admitted it may vary even after retirement
Yeah, some of the wording in the online booklet is worrying. Makes it’s sound like a glorified Ponzi scheme. The CWU have approved it so it must be brilliant
What's the betting that if Kretinsky takes over, he'll water the scheme down further? Lower company contributions etc.
I currently pay £155 per week & will have 5 years to retirement from October.
Using the same calculation comes up with the following,
£155 x 52 weeks x 5 years = £775 per week or £40300 per year. Lump sum would be £40300 x 3 = £120600. Someone correct me & bring me back down to earth before I order the Porsche.
You're currently in the RMDCP and paying in extra every week?
If so all your money is going into the same pot via Scottish Widows.
With the new scheme your basic contribution is 6% of your pensionable pay which goes towards the pension and lump sum. So it's the pensionable pay figure you need to use to work out what you might get.
If you want to save extra, you can pay another 1% into the lump sum(the DBLS) which is matched by RM, and/or pay into a DC AVC which is a similar arrangement to what you already have with the RMDCP.
I currently pay £155 per week & will have 5 years to retirement from October.
Using the same calculation comes up with the following,
£155 x 52 weeks x 5 years = £775 per week or £40300 per year. Lump sum would be £40300 x 3 = £120600. Someone correct me & bring me back down to earth before I order the Porsche.
You're currently in the RMDCP and paying in extra every week?
If so all your money is going into the same pot via Scottish Widows.
With the new scheme your basic contribution is 6% of your pensionable pay which goes towards the pension and lump sum. So it's the pensionable pay figure you need to use to work out what you might get.
If you want to save extra, you can pay another 1% into the lump sum(the DBLS) which is matched by RM, and/or pay into a DC AVC which is a similar arrangement to what you already have with the RMDCP.
Yes, in the RMDCP & paying avc's. Thanks for replying. Put simply, if I'm paying so much into an avc how am I able to use that when I draw the pension? Do I use it to buy my own annuitty? Or is it available to withdraw as I please, whilst being aware of taxes?
I currently pay £155 per week & will have 5 years to retirement from October.
Using the same calculation comes up with the following,
£155 x 52 weeks x 5 years = £775 per week or £40300 per year. Lump sum would be £40300 x 3 = £120600. Someone correct me & bring me back down to earth before I order the Porsche.
You're currently in the RMDCP and paying in extra every week?
If so all your money is going into the same pot via Scottish Widows.
With the new scheme your basic contribution is 6% of your pensionable pay which goes towards the pension and lump sum. So it's the pensionable pay figure you need to use to work out what you might get.
If you want to save extra, you can pay another 1% into the lump sum(the DBLS) which is matched by RM, and/or pay into a DC AVC which is a similar arrangement to what you already have with the RMDCP.
Yes, in the RMDCP & paying avc's. Thanks for replying. Put simply, if I'm paying so much into an avc how am I able to use that when I draw the pension? Do I use it to buy my own annuitty? Or is it available to withdraw as I please, whilst being aware of taxes?
You can use your RMDCP pot in two main ways:
Buy an annuity which provides an income for the rest of your life and can also pay spouses pensions on death.
Use drawdown, which provides an income of your choice until you run out of money.
If you were to pay AVC's via the new scheme the same would apply to that money.
The extra 1% lump sum payment with the new scheme, would go specifically to the DBLS and be used to fund a tax free lump sum when taking your pension, or else transferred out if you chose to do that.
I would be grateful if someone could explain how this thing isn't setup to fail.
Looking around all the RM sites I see a lot of people probably due to retire in the next 10 or so years. I don't see much full time recruiting going on either.
All I see is a dwindling workforce having to prop up a pension pot of ever growing number of pensioners, who in turn will have their monthly pension amount decrease as the pot gets smaller.
Are we hoping that stock market returns can outweigh this.
The only ones to benefit here are RM as they now have no liability to ensure that people get what they put in.
I’m on the other hand wondering what the tipping point is for auto enrolment vs opting out.
I’m only going to be in the new scheme for less than 6 months so I’ve already opted out.
Just curious to which way one would go!!
I would be grateful if someone could explain how this thing isn't setup to fail.
Looking around all the RM sites I see a lot of people probably due to retire in the next 10 or so years. I don't see much full time recruiting going on either.
All I see is a dwindling workforce having to prop up a pension pot of ever growing number of pensioners, who in turn will have their monthly pension amount decrease as the pot gets smaller.
Are we hoping that stock market returns can outweigh this.
The only ones to benefit here are RM as they now have no liability to ensure that people get what they put in.
Let’s hope some kind of stock market genius is handling it, other wise it looks like crap.
can someone explain it like the simpleton I clearly am? I get that 1/80th is a yearly sum, but my maths is £550 a week x 52 which equals £28,600. So times that by 30 is £858,000 divided by the magic 1/80th is £10,725.
