Anybody any idea?

[casp21]

I posted this on the pensions forum but only got one reply so trying my luck here as everyone reads 'Blue Shirts' and need more replies if possible.

I am taking VR and would like to know does the pension illustration for NRA65 shows 'forecast' amounts or amounts that have already been built up? In other words is the figures now shown on the illustration deferred at those figures or do they go down once i leave the business. I am 52 with 30 years service. Cheers!!

[mw7485]

I'm assuming you are talking about section C - the career average pension (not the FS pension). My assumption has always been that the quoted incomes are a projection for the particular NRA in question, based upon your contributions to date, provided they continue 'till the NRA in question. If you continue to work for RM, your annual beenfits should rise year on year, (assuming your pensionable pay doesn't reduce due to say a buy down of your contractural hours, or perhaps because you reduce OT hours). The converse is also true in that if you leave prior to the NRA or reduce your pensionable hours, your annual benefits will reduce. Quite honestly, the statements are a bit of a muddle and it is very difficult to get anything like an accurate projection. Its worth giving the pensions people a call - I have always found them to be very helpful.

You can however get an idea of what is in "your pot" (excluding AVCs) if you add up all the pension input amounts on all of your pension statements. It'll only be a rough and ready figure, but its better than nothing.

Of course, the usual caveats apply to my answer, this is only my understanding - I'm absolutely unqualified togive advise etc etc!!!

[casp21]

Thank you for your reply and i agree, it is a muddle the pensions

[mw7485]

The way I think of it (so it makes sense to me) is that the career average length continues until NRA - whether or not you still work for RM. So, if you leave, your pension is "less", since the time element doesn't change - but what your pot is worth from your point of departure only increases by inflation (ie, it doesn't really increases at all). So, "less" money over the "same time period" = less pension

[casp21]

Getting there trying to understand this. So really the NRA60 is frozen since 2008 and just building and the NRA65 if I leave with VR it stays the same but just builds also over the years. So the figures in NRA65 are what has been built up and not forecast figures for when I reach 65 if I was still working. It will be frozen at the figures on the illustration now if I leave? Nightmare trying to get my head around it all.

[RobertT]

I would agree that the annual statements are badly done but it’s not that hard to understand if you know what you’re looking at. From your post on the pensions forum I assume you’re a section A/B member and as I’m in section C I can only really guess what your statement looks like.

But in simple terms and assuming our statements are set out in a similar way, the amount listed under ‘NRA60 Benefits’ is what you accrued up to 2010 and that only goes up by inflation each year. The amounts listed under ‘NRA65 Benefits’ are really just a guestimate on what you would receive at 65 if you continue working for RM and at your current pay rate. As you have said you’ll be leaving soon with VR, those figures no longer apply.

The third lot of figures are to be found under the heading ‘Your Pension’. This is the amount of pension you’ve actually built up during your time at RM and this is the amount that will be deferred until you choose to take your pension.

[casp21]

RobertT, thanks for all your help. Its a lot clearer now.