Help!

[luddite]

Hi, I'm approaching 60 and have been given my Age60 for RMPP options which appear I ought to take even though I don't intend retiring yet.
1, if I take one of the Age60 options now do I still contribute to RMPP until I retire?
2, if I take my RMPP option do I have to at the same time take my Age60 options for RMSPS? As the RMSPS option letter does not say there is any benefit to take or not to take my Age60 at 60.
TIA, baffled.

[RobertT]

You have to take all your Age60 benefits at the same time, so you will get some from the RMSPS and some from the RMPP.
The same applies when you take your NRA65 benefits.

The RMSPS pay out the benefits you accrued up to 2012, while the RMPP pays everything afterwards.

There is no benefit to not taking your benefits at Normal Retirement Age, you're just depriving yourself of money for no reason.

If you just take your Age 60 benefits, you can currently continue to pay into the DBCBS, which is predominantly part of your Age65 benefits.

If you were to take both Age60 & Age65, then you would currently be able to pay into the RMDCP via Scottish Widows, instead.

Check out the media library on the RMPP website for some handy video guides that might help you understand things a bit better: https://www.royalmailpensionplan.co.uk/

Bear in mind that the impending new CDC scheme will replace all current RM pension arrangements for most people. So when that starts you will be paying into that instead, unless or course you want to pay into the inferior Nest scheme.
More details on CDC are here: https://www.myroyalmail.com/collective-plan

[Steve_claret]

You have to take both parts of your NRA60 pension so you will need to get a quote from both RMPP and RMSPS. There is nothing to be gained by not taking your NRA60 at age 60 as it won't be backdated from a later date. If as you state you intend to carry on working then be prepared to pay Basic Rate tax on both of your monthly pension payments as your annual tax free allowance will still be used against your RM pay. You can leave all of your NRA65 for now if you don't need to take it as if you took it at 60 you will lose 25% by taking it 5 years early. Whether you take it early or not is purely a personal decision.

[luddite]

Many thanks.

[vmaxv4]

They have revised the way they interact with yourself & others in the future.

[derricksmyth]

You have to take both parts of your NRA60 pension so you will need to get a quote from both RMPP and RMSPS. There is nothing to be gained by not taking your NRA60 at age 60 as it won't be backdated from a later date. If as you state you intend to carry on working then be prepared to pay Basic Rate tax on both of your monthly pension payments as your annual tax free allowance will still be used against your RM pay. You can leave all of your NRA65 for now if you don't need to take it as if you took it at 60 you will lose 25% by taking it 5 years early. Whether you take it early or not is purely a personal decision.

Can you take part of your NRA 60 benefits as a lump sum? Are you able to invest any or all of that lump sum in a Sipp?

[RobertT]

You have to take both parts of your NRA60 pension so you will need to get a quote from both RMPP and RMSPS. There is nothing to be gained by not taking your NRA60 at age 60 as it won't be backdated from a later date. If as you state you intend to carry on working then be prepared to pay Basic Rate tax on both of your monthly pension payments as your annual tax free allowance will still be used against your RM pay. You can leave all of your NRA65 for now if you don't need to take it as if you took it at 60 you will lose 25% by taking it 5 years early. Whether you take it early or not is purely a personal decision.

Can you take part of your NRA 60 benefits as a lump sum? Are you able to invest any or all of that lump sum in a Sipp?

Section A/B members automatically get a lump sum, but Section C'ers have to give up some pension to get one.

You won't be able to transfer it direct from RMPP/RMSPS to a SIPP, but once you've got it in your bank account you can do whatever you like with it.

You can transfer your DBCBS or AVC's to a SIPP.

[derricksmyth]

Cheers Robert. I'm a section C , joined June 1988, would the lump sum I take instead of part the NRA 60 regular pension be liable to income tax? Or would it be part of your tax free 25%? Thanks for your help!

[RobertT]

You can take a max of 25% as tax free cash.

Another possibility which I forgot to mention, is that you can transfer all of your RMPP benefits out to a SIPP if you chose. Which is everything from 2012 onwards upto when the CDC/DBLSS scheme starts.
You would have to get a CETV from them first and then get the blessing of an IFA, if it's got a value if over £30k.
You would of course be giving up an index linked income for life!

[derricksmyth]

I think I would just take the 25% tax free of the NRA 60 pension and then decide what I will do from there.

Thank you once again for your invaluable advice Robert!