NEM Alignment
Join Date: Jul 2007
Location: @exRAF_Al
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Reducing the pro rata future capital requirement for an officer's pension?
I can't post the picture directly, but it would appear that in the future, pay progression for OR is projected to increase at quite markedly a different rate, ahead of wage inflation and compared to that for an officer. The twin peaksesque rate of change seems to spike in about 5 and 20 years. The dulling down effect of NEM seems to kick in after that.
https://twitter.com/raf_ifa/status/578113103486808064
I can't post the picture directly, but it would appear that in the future, pay progression for OR is projected to increase at quite markedly a different rate, ahead of wage inflation and compared to that for an officer. The twin peaksesque rate of change seems to spike in about 5 and 20 years. The dulling down effect of NEM seems to kick in after that.
https://twitter.com/raf_ifa/status/578113103486808064
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Hi Just This Once.
I suppose it is the down side of protecting your rights in the old scheme.
The plus in AFPS 75 is that your benefits are calculated at the rank for pension and pension code for the proportionate length of service. The negative is that the rules for PVR remain.
I suppose it is the down side of protecting your rights in the old scheme.
The plus in AFPS 75 is that your benefits are calculated at the rank for pension and pension code for the proportionate length of service. The negative is that the rules for PVR remain.
Originally Posted by Al R
I think what you were trying to say is that comparative mortality illustrations for officers predict 88% for S1NXA, and the same for other ranks runs at 118% of S1NXA?
I took it as good news as I am no longer due to cork it at 86.9 years old and now soldier on till 91.2 years old.
Although this bit was ominous:
4.10 We note that there is a possibility that changes to employment patterns in the Armed Forces as a result of deployment characteristics and the introduction of the 2015 scheme and New Employment Model may affect the rates of mortality experienced by future pensioners.
Join Date: Jul 2007
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But it won't affect anyone's career path though. Honestly.
https://twitter.com/raf_ifa/status/578136208456486912
Just another Jocky,
Chats about discount rates on future capital requirements can be quite interesting. The evenings fly by.
https://twitter.com/raf_ifa/status/578136208456486912
Just another Jocky,
Chats about discount rates on future capital requirements can be quite interesting. The evenings fly by.
Apologies, but I've been wading through the latest long term actuarial assumptions of AFPS, post April 2015. I'm afraid the government's conclusion is we're all going to die. Doomed I tell you.
According to the pensions calculator and the x20 factor plus lump sum formula my PAS pension virtual pot is worth £1,033,437 at retirement.
With no index linking until 2018 the amount above the LTA will only increase, so it looks like I will be one of those hit by this rather punitive 55% tax rate.
Or I could leave early….
With no index linking until 2018 the amount above the LTA will only increase, so it looks like I will be one of those hit by this rather punitive 55% tax rate.
Or I could leave early….
…but if I leave a year earlier my virtual pot is apparently worth even more (!) and currently stands at £1,057,169 - albeit a good part of it is deferred to state pension age.
This is all rather complicated.
I need Al R to make sense of it all.
This is all rather complicated.
I need Al R to make sense of it all.
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JTO,
You can consider the merits of Protection..?
https://www.gov.uk/government/public...rotection-2014
On that first prediction, it looks like your pension will be cut by £712 or so pa.
You can consider the merits of Protection..?
https://www.gov.uk/government/public...rotection-2014
On that first prediction, it looks like your pension will be cut by £712 or so pa.
Al, IP 2014 is only available for those who already have >£1.25m contributions into their pension pot. I guess that rules out most/all of us here if we are talking about just breaching the £1m mark during an extension to 60yo???
Quote from IP14 in your link;
Individuals who have pension savings of greater than £1.25 million on 5 April 2014 can apply for individual protection 2014, providing they don’t have existing primary protection.
Quote from IP14 in your link;
Individuals who have pension savings of greater than £1.25 million on 5 April 2014 can apply for individual protection 2014, providing they don’t have existing primary protection.
Last edited by just another jocky; 18th Mar 2015 at 14:46. Reason: ]
I suspect my constantly delayed membership of the Forces Pension Society has just inched its way up the priority list.
I suspect it's not just those on PAS that need to be concerned. If you're 30s/early 40s and either potentially looking at wg cdr or taking an option with a view to a potentially well paid second career then protection might be something for all of us to consider. In terms of a life time allowance, as I've surprisingly discovered, even a mere sqn ldr pension gets you close to half the new limits, whilst the added effect of compounding returns over say 20-25 years in a second pension may just take you over the line.
Definitely time to start talking to people that understand the ins and outs of all this. For now though, I think I'll be thinking more of ISAs than SIPPs to top up the pension.
I suspect it's not just those on PAS that need to be concerned. If you're 30s/early 40s and either potentially looking at wg cdr or taking an option with a view to a potentially well paid second career then protection might be something for all of us to consider. In terms of a life time allowance, as I've surprisingly discovered, even a mere sqn ldr pension gets you close to half the new limits, whilst the added effect of compounding returns over say 20-25 years in a second pension may just take you over the line.
Definitely time to start talking to people that understand the ins and outs of all this. For now though, I think I'll be thinking more of ISAs than SIPPs to top up the pension.
It seems to me, that these pension taxation "traps" are primarily designed to claw back high-endish future public sector pensions. True highly paid (civi) jobs will continue to pay more during employment, leaving the "golden" public pension a thing of the past. 
OAP
OAP
High Spirits,
Al R posted a link to the last HMRC publication on Protection - it's a few posts back.
I would envisage future protection being different in detail but similar in principle, you might get at least an idea from it. I'm thinking similar thoughts as to whether I might need protection looking 25+ years down the line, so I will be keen to see what they say following these latest changes.
Al R posted a link to the last HMRC publication on Protection - it's a few posts back.
I would envisage future protection being different in detail but similar in principle, you might get at least an idea from it. I'm thinking similar thoughts as to whether I might need protection looking 25+ years down the line, so I will be keen to see what they say following these latest changes.
It's a real shame that AFPS15 did not include some flexibility when it came to things like the LTA. An option to cease pension accrual whilst retaining death in service benefit would be one idea. The other would be to gain additional income or other benefits if you opted-out of the scheme.
Fat chance I know.
Fat chance I know.