22 Feb 2020, 21:58

Could anyone show me how ones pension is worked out, if employed from 1980 and nra60 is due to be paid out

This October? So I, m in pension B final salary up to 2008.

No avcs ect. Just need guide how calculation is done thanks

This October? So I, m in pension B final salary up to 2008.

No avcs ect. Just need guide how calculation is done thanks

23 Feb 2020, 02:37

If it is assumed that you want the maximum tax free lump sum which is what over 80% of people decide to go for....

((Yearly pensionable pay x service accrued(start date to 31March 2008)/80) x 23)+((block pension accrued from 1April 2008 until 31 March 2010 x RPI from September 2008 Until September 2019) x 23) = pension pot.

Pension pot/4 = maximum tax free lump sum

Maximum tax free lump sum /80 = monthly pension.

This should give you a reasonably accurate figure.

Please note that the reason I've multiplied by 23 is because you are in Section B and receive a lump sum of treble your yearly pension. If you are in Section C multiply by 20 and divide by 60.

Also I have worked out that the average RPI from September 2008 until September 2019 was 2.7% if that is of any help.

The reason I divide the maximum tax free lump sum by 80 is just shorthand. The actual calculation is

(Maximum tax free lump sum x 3) /20= yearly pension

Yearly pension / 12 = monthly pension.

I have also assumed that the multiplier used is 20 which is widely used in the pension industry.

RobertT, what do you think?

((Yearly pensionable pay x service accrued(start date to 31March 2008)/80) x 23)+((block pension accrued from 1April 2008 until 31 March 2010 x RPI from September 2008 Until September 2019) x 23) = pension pot.

Pension pot/4 = maximum tax free lump sum

Maximum tax free lump sum /80 = monthly pension.

This should give you a reasonably accurate figure.

Please note that the reason I've multiplied by 23 is because you are in Section B and receive a lump sum of treble your yearly pension. If you are in Section C multiply by 20 and divide by 60.

Also I have worked out that the average RPI from September 2008 until September 2019 was 2.7% if that is of any help.

The reason I divide the maximum tax free lump sum by 80 is just shorthand. The actual calculation is

(Maximum tax free lump sum x 3) /20= yearly pension

Yearly pension / 12 = monthly pension.

I have also assumed that the multiplier used is 20 which is widely used in the pension industry.

RobertT, what do you think?

23 Feb 2020, 08:55

Just read your post. Isn't section B increased by CPI not RPI? CPI being lower.

23 Feb 2020, 09:51

I think it’s CPI after you take your pension for yearly increases but RPI before you take it.

It was yet another watering down of peoples pension entitlements.

It was yet another watering down of peoples pension entitlements.

23 Feb 2020, 10:12

rks wrote:Could anyone show me how ones pension is worked out, if employed from 1980 and nra60 is due to be paid out

This October? So I, m in pension B final salary up to 2008.

No avcs ect. Just need guide how calculation is done thanks

I'm in section C so have no first hand knowledge of section A/B, but the way I understand things is that Section B final salary(up to 2008) was worked out as 1/80th of pensionable pay for each year worked, plus a lump sum of 3 times pension.

The CSDB pension(2008-2018) was worked out in a similar way, but was based on actual earnings rather than final salary pay.

The current version of the plan guide might give you more info, but doesn't really go into detail. It's available to view here: https://www.royalmailpensionplan.co.uk/ ... ts/library along with some other guides you might find useful.

If you've kept any older plan guides, which you should have been sent, they will tell you more.

Also bear in mind that the pay that's used for pensionable purposes now increases with inflation rather than actual pay. That's been the case since 2014.

23 Feb 2020, 14:51

Thanks,

May I also ask is the current pensionable pay

Used ie will it be my pensionable pay when my nra60 is due to be paid used or is it the pensionable pay in each year worked used for calculation?.

Though I thought it was the current one as many managers seem to be elevated to higher grades just before they retired.

May I also ask is the current pensionable pay

Used ie will it be my pensionable pay when my nra60 is due to be paid used or is it the pensionable pay in each year worked used for calculation?.

Though I thought it was the current one as many managers seem to be elevated to higher grades just before they retired.

23 Feb 2020, 15:51

rks wrote:Thanks,

May I also ask is the current pensionable pay

Used ie will it be my pensionable pay when my nra60 is due to be paid used or is it the pensionable pay in each year worked used for calculation?.

Though I thought it was the current one as many managers seem to be elevated to higher grades just before they retired.

Section B was a Final Salary scheme up to 2008 which is why managers used to be made up and put on nights with a pensionable shift allowance to boost their overall pensionable pay and hence their pensions.

Your current pensionable pay should be on your 2019 benefit illustration. Multiply that by your reckonable years up to 2008 and divide by 80 to work out your Final Salary annual pension. Your standard lump sum will then be 3x your annual pension but you have the option of taking 25% of your total pot as a tax free lump sum and a lower pension.

You will also have 2 years career salary pension up to 2010 included in your NRA60 which will also need to be added on to the Final Salary figures.

23 Feb 2020, 15:58

As Steve says,it's current pensionable pay.

The RMPP website states:

When calculating your pension benefits, we add up the following parts:

Your final salary pension: This is the pension you’ve built up to 31 March 2008. It’s based on the number of years and days you worked up to then, and your current pensionable salary.

Your CSDB pension: This stands for ‘Career Salary Defined Benefit’, and is the pension you’ve earned based on your service from 1 April 2008 to 31 March 2018. Each year you earned another ‘block’ of this, and the blocks are revalued over time.

Your Cash Balance benefit: This means the lump sum you’ve earned on or after 1 April 2018.

The RMPP website states:

When calculating your pension benefits, we add up the following parts:

Your final salary pension: This is the pension you’ve built up to 31 March 2008. It’s based on the number of years and days you worked up to then, and your current pensionable salary.

Your CSDB pension: This stands for ‘Career Salary Defined Benefit’, and is the pension you’ve earned based on your service from 1 April 2008 to 31 March 2018. Each year you earned another ‘block’ of this, and the blocks are revalued over time.

Your Cash Balance benefit: This means the lump sum you’ve earned on or after 1 April 2018.

23 Feb 2020, 16:20

Thank you