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CDC scheme and Cash bal temp scheme -Question please

24 Feb 2020, 08:29

I, as you well know, am planning to retire in Dec 2020.
I plan to start the ball rolling in either June or July to receive my lump sums on the 1st Dec and my first pension payments at the end of that month.
So far I have
My final salary pension
My Csdb pension
My Cash bal temp scheme which has almost reached £11448 by Apr 2020
I hope and expect lump sums of approx £54,000 FS and a pension of around £8200 (includes 16% reduction for max lump sum and 2 months early at 59 and 10 months) , Csdb lump sum of around £12000 to 14,000 and a pension of around £2200 (taking a 42% hit for max lump sum and taking it 5 years and 2 month early)
I then hope to take as much of my Cash balance scheme cash as cash, even if that means paying some tax on it.
At present the CDC scheme is sailing through Parliament, so
1) I don't know how long we have left in the temp cash bal scheme before a CDC scheme starts
2) Should I be preparing to end all my pensions BEFORE the CDC scheme comes in and take a slightly bigger hit.
I have no idea of the effect on my current temp Cash bal scheme of CDC?
Will the new CDC scheme prevent me taking the cash balance (temp scheme cash balance) I currently hold as cash?
Will that Cash be placed into the CDC scheme and I be prevented from taking it as cash?
Is it even worth being in a CDC scheme for 8 months?
If the effect of joining the CDC scheme was to make life more complicated for me, I am not sure I want to bother.
However I also have to consider that till Dec 20 my family has death in service protections?
Any thoughts?

CDC scheme and Cash bal temp scheme -Question please

24 Feb 2020, 15:22

I don't think anyone knows for sure when CDC is likely to be implemented, but my guess is around September/October 2020.

The current DBCBS(cash balance) arrangements will stop automatically when CDC starts. No point in biting your nose of to spite your face by opting out beforehand. In general always take advantage of free money when it's available, but if you're only in CDC for a few weeks, maybe there would be no point.

Cash Balance and CDC are not connected! The cash balance provides a lump sum to take with your already accrued RMPP(NRA60/NRA65) benefits. CDC will be totally separate.

CDC scheme and Cash bal temp scheme -Question please

24 Feb 2020, 16:56

RobertT wrote:I don't think anyone knows for sure when CDC is likely to be implemented, but my guess is around September/October 2020.

The current DBCBS(cash balance) arrangements will stop automatically when CDC starts. No point in biting your nose of to spite your face by opting out beforehand. In general always take advantage of free money when it's available, but if you're only in CDC for a few weeks, maybe there would be no point.

Cash Balance and CDC are not connected! The cash balance provides a lump sum to take with your already accrued RMPP(NRA60/NRA65) benefits. CDC will be totally separate.

Thank you.
Earlier today I spoke to the pensions people and they appeared to agree with what you have just told me, is that they don't expect the two schemes to be connected.
They said the earliest I can apply is July 1st for Dec 1st. I may apply June 1st for Nov 1st, to be sure my pension would be in place before I leave (although I hate to do the latter as that would be another half a per cent lost)
It appears to me from rough calculations, that I will lose 15% for max lump sum FS and another 1% for going 2 months early in Dec 20 scetion B. Plus a reduction of 16% for taking max lump CSDB and 26% for taking 5 years and 2 months early. I should get around £8300 FS pension and a Max lump of around £55,000. Csdb max lump of around £15000 and a pension of £2200. With however it gets mixed in a Cash balance till Apr 20 of around £11000. I am going to ask for as much cash as I can have, even if I have to pay a little tax.
I wonder if I will claim in time to get the free £750 which I can use towards advice before the CDC scheme comes in?

CDC scheme and Cash bal temp scheme -Question please

24 Feb 2020, 16:57

stephen500 wrote:
RobertT wrote:I don't think anyone knows for sure when CDC is likely to be implemented, but my guess is around September/October 2020.

The current DBCBS(cash balance) arrangements will stop automatically when CDC starts. No point in biting your nose of to spite your face by opting out beforehand. In general always take advantage of free money when it's available, but if you're only in CDC for a few weeks, maybe there would be no point.

Cash Balance and CDC are not connected! The cash balance provides a lump sum to take with your already accrued RMPP(NRA60/NRA65) benefits. CDC will be totally separate.

Thank you as always Robert.
Earlier today I spoke to the pensions people and they appeared to agree with what you have just told me, is that they don't expect the two schemes to be connected.
They said the earliest I can apply is July 1st for Dec 1st. I may apply June 1st for Nov 1st, to be sure my pension would be in place before I leave (although I hate to do the latter as that would be another half a per cent lost)
It appears to me from rough calculations, that I will lose 15% for max lump sum FS and another 1% for going 2 months early in Dec 20 scetion B. Plus a reduction of 16% for taking max lump CSDB and 26% for taking 5 years and 2 months early. I should get around £8300 FS pension and a Max lump of around £55,000. Csdb max lump of around £15000 and a pension of £2200. With however it gets mixed in a Cash balance till Apr 20 of around £11000. I am going to ask for as much cash as I can have, even if I have to pay a little tax.
I wonder if I will claim in time to get the free £750 which I can use towards advice before the CDC scheme comes in?

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