As a member of the RMDCP, you’re building up a pot of money to use when you retire. But how much money will you have?
To help you see how much you could have to spend when you stop work, the Trustees send you a statement every year.
It shows you how much your money has grown in the last year…
…And how much you could have in the future.
Let’s take a closer look. The example we’re using is for members who are still saving into the Plan, so if you’re a deferred member, your statement will look a bit different.
We’ll start with where you are right now.
On the left-hand side, you can see how much money was in your pension pot on this date.
So you can see what’s changed, it tells you how much was in your pot a year ago, and how much it’s earned by being invested in the past year. This is after taking off any charges you’ve paid, any money you’ve transferred out of your pot, and any cash in transit – by which we mean not yet invested at the statement date.
Then you can see your total savings for the year – money you’ve saved and money Royal Mail has added for you.
The last line shows you how much money – if any – you’ve transferred into your pot from another pension plan.
All of these things added together give you the total amount you’ve built up so far.
Remember, you might be saving into your pension through Pension Salary Exchange, which can save you some National Insurance payments.
Now, the right-hand side is all about the future – and how much you could have to spend when you stop work.
First it tells you how much money is expected to go into your pot in the coming year, and where that money will come from. Of course, you can change this if you want to by filling in a Choices form.
It shows you that you’ll swap this amount of your take-home pay for this amount of money in your pension pot.
There’s a big difference between these two figures, because most of the money comes from Royal Mail and the taxman.
Royal Mail adds this amount of money for you, and you get tax relief on the money you save. So, putting this amount of money in your pot only reduces your take-home pay by this much.
Your statement also tells you how much you could have to spend when you retire.
You’ll see how much your total pension pot might be worth and how much this might give you if you bought an annuity from an insurance company, which would give you a regular income for the rest of your life.
In the rest of your statement, you can check that the personal details we have for you are right, find out how to tell us who you’d like your pension money to go to when you die and see where the money in your pension pot is invested, and how to change that – if you want to.
Your annual benefits statement is your official record of how your RMDCP pension pot is building up, and what it could give you when you stop work. So, it’s a good idea to keep it somewhere safe.
For more information about the RMDCP and how it works, take a look at rmdcp.uk.
