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Pension new starter

13 Nov 2019, 13:43

Hi

I started working for RM last week as a part-timer (20 hours per week plus overtime)
I'm not really sure what is best to do regarding the RM pension
I have sent off the form to start my RM within the first 12 months
I did work for 2 years for Angard but unfortunately, this pension pot can't be transferred to RM
I do have a personal pension which I pay £250 per month into so I will transfer Angard/Now Pensions pot into that

However, I'm a bit uncertain about what to do with the RM one as I'm not a Spring Chicken (aged 41)
With it being within 12 months my contributions are fixed at a certain percentage so I can't do anything increasing my deductions in that regard

Does anybody have any general advice about the RM pension scheme?

Thanks in advance
Paul

Pension new starter

13 Nov 2019, 15:49

The general advice with any workplace pension is always sign up and pay in at least whatever it takes to get the maximum employer contribution.

In your first year of RM employment I think your contributions are fixed at 5% with 3% from RM. But you also benefit from tax relief and salary sacrifice(RM call it PSE), which means each £1 gross contribution from you only actually costs £0.68.

So for example, if you're paying in a gross of £10 per week(the amount on your payslip) that would only cost you £6.80 because your income tax gets reduced by £2 and you NIC's by £1.20. Plus you'll also get £6 from RM. Meaning you're getting £9.20 in 'free money' each week.

It might not be much, but every bit counts.

I think there are around 12 funds to choose from, but this link will tell you more: https://www.scottishwidows.co.uk/save/royalmaildcplan/

Pension new starter

13 Nov 2019, 18:11

Save as much as possible.

Start as soon as possible.

Pay yourself first (i.e. have it taken out of your pay)

Every £ saved now compounds in interest over the years and ultimately means you can retire earlier......

Saving regularly and early really is life changing over a long period of time.

Good Luck

Pension new starter

22 Nov 2019, 01:22

Thanks very much for the advice :)

Pension new starter

22 Nov 2019, 16:36

Some advice you may find useful is this. Appreciating everyone has a different attitude to risk but it's generally reasonable to choose a more "aggressive" fund to invest in at your age.

As retirement nears, reduce your exposure to volatility. I left RM in '04 but recently took my pension, hence the retained interest on here. I can only assume you have the option to choose a more or less aggressive fund. Good luck.

Pension new starter

22 Nov 2019, 16:36

Some advice you may find useful is this. Appreciating everyone has a different attitude to risk but it's generally reasonable to choose a more "aggressive" fund to invest in at your age.

As retirement nears, reduce your exposure to volatility. I left RM in '04 but recently took my pension, hence the retained interest on here. I can only assume you have the option to choose a more or less aggressive fund. Good luck.

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