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A deep-dive into a variety of pension topics to help you understand and learn more about your pension and the Scheme.
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A deep-dive into a variety of pension topics to help you understand and learn more about your pension and the Scheme.
Our blogs will give you information, tips, insights and guidance to help you get to know your pension and support you on your journey to retirement.
For today’s work life alumni, retirement has changed significantly since their parents’ day. There’s greater uncertainty about the future and new retirees are exposed to a greater choice about when and how to retire, or whether to retire at all.
Everyone’s circumstances are different. What’s true for many new retirees, though, is that stopping work can be a difficult transition. It’s about re-starting life at later age – it may sound exciting, almost adventurous, but research and word of mouth tell us it can be quite challenging and nerve-racking for some, especially for those retirement ‘freshers’ who don’t enjoy change as much.
This is why we’ve pulled together our top tips to help ease you into your retirement and enrich your experiences.
An ongoing study by Harvard University, found that the number one key to a happy life is ‘social fitness’. The most consistent finding the researchers reported on is that positive relationships keep us happier, healthier and help us live longer. The same study found that retirees don’t miss working, they miss the people. It said the number one challenge people face in retirement is not being able to cultivate and replace the social connections they had while they were working.
We are social creatures who thrive on companionship, but as we get older and our lives get busier, relationships can be difficult to maintain. As we all know, plants need watering to flourish, and so do our relationships. Here are a few ideas for you to consider if you think you might benefit from enriching your social life:
It could’ve been 20 years, 10, or even 1, since you last got together and in the quieter moments, you may find yourself wondering about them. A recent study of more than 5,900 people found that people often underestimate how much old friends appreciate hearing from them. You could spend the rest of your lives creating new memories together. What’ve you got to lose?
Think of your most spontaneous moments over the years. Maybe you hopped on a train with your best friend without checking the destination. Perhaps when you heard ‘I’ve had the time of my life’ at parties, everyone mistook you for Patrick Swayze. Make things exciting by trying new activities with friends and partners, things neither of you has done before. Mutual vulnerability opens new avenues for connection.
Research shows that 30 minutes of walking with another person boosts your mood, improves your health and staves off chronic conditions. Having a positive conversation with another person releases the feel-good hormone oxytocin. Coupled with the endorphins released by light exercise and nature’s gifts to the senses, you’ll anticipate your next walk before this one’s over.
It’s a myth that retirement is a passive stage of life. It’s actually quite the opposite for a lot of people but the key is proactivity – it’s up to you to make stuff happen and to stay physically and mentally sharp as you enter this new phase of life.
Mental Health Awareness Week (13 – 19 May) is to take place soon and this year’s theme is Movement: Moving more for our mental health. Staying active is scientifically proven to boost your mood, improve your sleep and your energy levels. Exercising looks different for everyone. It could be as simple as standing up from your chair regularly and walking between rooms, a 20-minute walk in the park to breathe in the fresh air, going for a run or doing a fitness class either at home or at the gym.
Research shows you’re more likely to stick to exercise if it’s part of your routine. You could walk to the shops instead of taking the bus, or join an exercise class. You might be surprised at how much healthier and happier you feel!
Life keeps evolving even when your working days are over. It might be that you may want to try a new hobby, or to pursue a passion you simply hadn’t had the time for so far, or it might be that you want to dedicate some of your time to charitable work and volunteering. Whatever route you go down, remember each new interest or activity can open doors and expand your horizons in unexpected ways.
Once you’re past the inevitable ‘honeymoon phase’ of retirement and you’ve ticked some quick wins you’ve been patiently waiting for while still working, a burst of boredom may strike. Use this quiet time for self-reflection. It presents a great opportunity to clarify your priorities, re-evaluate your lifestyle and sense of purpose, and think about what you may want to fill in your free time with.
22/8/2022
Author: Editorial
<div>Pension Credit is separate from your State Pension, and you may still be able to claim it even if you have another income, savings or are claiming another pension. It's a payment from the government to help with living costs if you’re over State Pension age and on a low income. </div><div><br></div><h3>Who is eligible for Pension Credit?</h3><div>To claim Pension Credit you must have reached <a href="https://www.gov.uk/state-pension-age" target="_blank" data-sf-ec-immutable="">State Pension age</a> and live in England, Scotland or Wales. Even if you’re still working, you may be able to claim Pension Credit to top up your income if you’re over State Pension age. </div><div><br></div><div>You can apply for Pension Credit up to four months before you reach State Pension age, and any time after. It’s worth bearing in mind that if you are eligible for Pension Credit it can only be backdated by up to three months. </div><div><br></div><div>Your State Pension age will depend on when you were born. Use the Gov.uk website to check your State Pension age.</div><div><br></div><h3>Applying for Pension Credit</h3><div>As part of your application for Pension Credit the government will consider your income. If you have a partner, their income will also be included. </div><div><br></div><div>Income includes: </div><ul><li>Any other pensions you have, including pensions you have not claimed yet</li><li>Your State Pension</li><li>Your earnings from employment or self-employment</li><li>Most social security benefits</li></ul><div>The government will also consider your savings and investments.</div><div><br></div><div>Using this information, the government will then calculate the amount of Pension Credit you will be able to get.</div><div><br></div><div>To find out if you may be able to claim Pension Credit and for more guidance on how to apply, visit <a href="https://www.gov.uk/pension-credit/eligibility" target="_blank" data-sf-ec-immutable="">Gov.uk</a>. </div><div><br></div><h3>How Pension Credit works</h3><div>Pension Credit tops up your income to £182.60 a week if you are single. Or if you have a partner, Pension Credit will increase your combined weekly income to £278.70.*</div><div><br></div><div>If you’re eligible for Pension Credit, it could help you with day-to-day living costs such as Council Tax, housing costs, NHS Services and heating bills. If you’re over 75, you could be entitled to a free TV license with Pension Credit, so it’s worthwhile looking into. </div><div><br></div><div>Even if you have savings or receive another pension, you may be entitled to Savings Credit. To claim Savings Credit, you must have reached State Pension Age before 6 April 2016, and have saved some money for when you stop working, such as a pension. If you’re eligible, you will get up to £14.48 Savings Credit a week if you’re single, and if you have a partner, you’ll get up to £16.20 a week.* </div><div><br></div><div>If you want to find out how much Pension Credit you could get you can use the <a href="https://www.gov.uk/pension-credit-calculator" target="_blank" data-sf-ec-immutable="">Pension Credit Calculator</a>.</div><div><br></div><div><em>*Figures are correct as of August 2022 but may change. To check the latest figures, visit <a href="https://www.gov.uk/pension-credit/eligibility" target="_blank" data-sf-ec-immutable="">Pension Credit: Eligibility - GOV.UK (www.gov.uk)</a> or <a href="https://www.gov.uk/pension-credit/what-youll-get" target="_blank" data-sf-ec-immutable="">Pension Credit: What you'll get - GOV.UK (www.gov.uk)<div></div></a><br></em></div><p><em><em> </em></em></p>
Find out how Pension Credit works and who can claim it.
5/5/2023
Author: Editorial
<p>Providing for our loved ones is something many of us worry about after we die. So, it’s reassuring to know those who matter to you could get some help when you’re no longer around to support them. </p><p>A valuable benefit of your Railways Pension Scheme (RPS) membership is that a lump sum might be paid if you die before taking your pension. So, it’s a good idea to tell us who you’d like the money to go to by completing a nomination form. </p><p><strong>Why nominate?</strong></p><p>A lump sum may be paid if you die before you claim your Railways pension (or within five years of taking it). This is usually tax-free.</p><p>It’s important you name the people or organisations you want the money to go to by making a nomination. The Trustee considers your nominations when deciding who to make any payments to. </p><p>If you don’t make a nomination, the Trustee may not know where to pay the money. This could mean the payment is delayed, and even taxed as a result. </p><p>It’s a difficult time when you lose someone, without added financial stress and disagreements between friends and family. So it’s a good idea to nominate to help prevent unnecessary worry.</p><p><strong>Who can I nominate?</strong></p><p>You can nominate:</p><ul><li>An individual, or several people, such as family and friends</li><li>Organisations or good causes</li><li>Charities</li></ul><p>Nominations are confidential, so your nominees won’t know if you’ve added or removed them as a nominated beneficiary. You can nominate as many people as you want to.</p><p>Make sure to keep your nominations up to date so they still reflect your wishes, particularly if your circumstances change. You could make a note in your diary to review your nominations every year or so.</p><p><strong>How do I nominate?</strong></p><p>The quickest way to make a nomination is to <a href="https://member.railwayspensions.co.uk/login" data-sf-ec-immutable="">log into your myRPS</a> account (make sure to <a href="https://member.railwayspensions.co.uk/register" data-sf-ec-immutable="">register for an online account</a> if you haven’t already).<strong> </strong>When you’re logged in, select ‘My Nominations’ and follow the simple steps.</p><p>If you have more than one period of membership in the Scheme, you should make separate nominations for each of your records, even if you are nominating the same people. You can do this in your myRPS account by switching between your membership records.</p><p>Or, you can download the <a href="https://cdn.rpmi.co.uk/mp-sitefinity-prod/docs/default-source/forms/forms-for-all-members/nomination-form6b7e5b868b1b419db50f7607489e41ed.pdf?sfvrsn=746a069f_6" target="_blank">Nomination form</a>, print it off and fill out your nominations. Then return it using the instructions and the Railpen address on the form.</p><p>When you nominate, you’ll need to give the following details of your nominee(s):</p><ul><li>Title</li><li>Name</li><li>Relationship to you</li><li>Nominee’s address</li><li>Percentage of the pension benefits you’d like your nominee to receive</li><li>Details of your nominee’s guardian if they are under 18 (you can’t name yourself)</li></ul><p>When you’ve made your nominations, we’ll let you know your wishes have been recorded within 28 days.</p><p><strong>Is a nomination the same as a will?</strong></p><p>A nomination is <strong>not</strong> the same as a will. Your nominations show where you’d like a lump sum from your pension to go if you die before you claim it, and this cannot be covered in your will. </p><p>Many people think everything they own will be given out according to their will when they die. It’s important to remember that if you die, your Railways pension is separate to the rest of your estate. </p><p>You can learn more about how death benefits might work on the dedicated <a href="/knowledge-hub/help-and-support/reporting-a-death">reporting a death page</a>.</p><p><strong>Who can nominate?</strong></p><p>Every member can nominate, unless they’ve already been taking their pension for more than five years. We strongly encourage you to nominate – it’s quick, easy, free and could make life for your loved ones much easier. </p>
King Charles III will be crowned successor to the throne. Have you thought about what your own ‘successors’ might get in the event of your death?
3/4/2024
Author: Editorial
<p>The government recently announced that the State Pension will increase by 8.5%, under its commitment to the State Pension triple lock. The triple lock ensures that the State Pension doesn’t lose value over time. You can <a href="https://commonslibrary.parliament.uk/the-triple-lock-how-will-state-pensions-be-uprated-in-future/" target="_blank" data-sf-ec-immutable="">learn more about it here.</a></p><p>With the increase, you might be able to claim up to approximately £11,500 a year in State Pension from the government. </p><p>While that might <em>sound</em> like enough to help you get by, the reality is if you’re planning to live on the State Pension alone you may find yourself short of cash. </p><p>Here’s why the State Pension might not be enough for you to live on, and our top tips to help you save more for your life after work with your RPS pension, including <a href="https://member.railwayspensions.co.uk/pension-essentials/saving-more" data-sf-ec-immutable="">making Additional Voluntary Contributions (AVCs).</a></p><h4> </h4><h4>Why the State Pension might not be enough:</h4><h3>The cost of retirement is higher than ever</h3><p>The Pensions and Lifetime Savings Association (PLSA) has released their updated <a href="https://www.retirementlivingstandards.org.uk/" target="_blank" data-sf-ec-immutable="">Retirement Living Standards (RLS).</a> The RLS estimate how much you might need in retirement each year, based on 3 different standards of living – minimum, moderate and comfortable. </p><p>According to the RLS, a single person needs £14,400 to afford a ‘minimum’ standard of living. That means even if you’re able to claim the full amount of State Pension, you’ll be approximately £2,900 short of a minimum standard of living in retirement. And that’s without budgeting for any extra personal costs, such as mortgage or rental outgoings.</p><p>To get an idea of how much you might need <a href="https://member.railwayspensions.co.uk/login" data-sf-ec-immutable="">try the Retirement Budgeting Calculator in your myRPS account</a>. It’s based on the RLS and lets you add your personal lifestyle costs, including how many holidays you’d like per year, your motoring or transport costs and where you plan on living. <br></p><h3><br>You might not be able to claim the full amount of State Pension</h3><p>The amount of State Pension you’ll get depends on your National Insurance (NI) record. To claim the full amount of the State Pension, you’ll need 35 qualifying years of NI contributions or credits.* You can <a href="https://www.gov.uk/check-state-pension" target="_blank" data-sf-ec-immutable="">check your State Pension forecast at Gov.uk</a>. </p><p>If you’ve previously worked part-time, you might not have paid as many NI contributions or credits over the years. And, this could impact the amount of State Pension you might be able to claim later. </p><p>You may be able to ‘top up’ your NI record by paying voluntary contributions, if you’re eligible. You can <a href="https://www.gov.uk/voluntary-national-insurance-contributions" target="_blank" data-sf-ec-immutable="">learn more about Voluntary National Insurance at Gov.uk</a>.<br><br></p><h3>You'll need to wait until your State Pension age (SPA) to claim it<br></h3><p>You won’t be able to claim your State Pension until <a href="https://www.gov.uk/state-pension-age" target="_blank" data-sf-ec-immutable="">your State Pension age (SPA)</a>, which is currently age 66 for both men and women. </p><p>But, the SPA is set to increase again from May 2026. So, if you’re planning to retire before you reach your SPA, you’ll need to consider how you’ll pay for your retirement during that time.<br><br></p><h3>The State Pension is currently less than the National Minimum Wage<em></em></h3><p>In life after work, most of us would like to continue the lifestyle we’ve enjoyed while working. But, living off the State Pension alone might mean it’s difficult to maintain that standard of living. Here’s an example to explain why. </p><p>If, while you were working, you earned the National Minimum Wage and worked 35 hours per week, your yearly income would be approximately £19,000. </p><p>If you then reach State Pension Age (SPA), and are able to claim the full amount of State Pension from the government, your State Pension income would be approximately £11,500 a year. </p><p>Comparatively, your State Pension income would be roughly £7,500 less than the income you had while you were working. This could significantly impact the lifestyle you’re able to afford in retirement. What’s more, the difference could be even greater if you’re not able to claim the full amount of State Pension. <br><br></p><h3>Your State Pension might not increase if you live abroad</h3><p>Moving abroad to spend retirement under the sun is something many of us have dreamt about. While the idea of life after work in another country might capture your interest, it’s important to consider that your State Pension might not increase while you’re living there.</p><p>Currently, your State Pension will only increase each year if you live in:</p><ul><li>The <a href="https://www.gov.uk/eu-eea" target="_blank" data-sf-ec-immutable="">European Economic Area (EEA)</a></li></ul><ul><li>Gibraltar</li></ul><ul><li>Switzerland</li></ul><ul><li><a href="https://www.gov.uk/government/publications/state-pensions-annual-increases-if-you-live-abroad/countries-where-we-pay-an-annual-increase-in-the-state-pension" target="_blank" data-sf-ec-immutable="">Countries that have a social security agreement with the UK</a> (but you cannot get increases in Canada or New Zealand)</li></ul><p>You will not get yearly State Pension increases if you live outside these countries. However, your State Pension will go up to the current rate if you move back to the UK. </p><p>You can learn more about how your State pension is affected, including how you can claim it if you move abroad at <a href="https://www.gov.uk/state-pension-if-you-retire-abroad/rates-of-state-pension" target="_blank" data-sf-ec-immutable="">Gov.uk</a>. </p><h4> </h4><h4>How you could save more:</h4><p>As a member of the Railways Pension Scheme (RPS), you’re already saving towards a retirement income which you’ll get separate to your State Pension.</p><p>You can find out how much you might get from your RPS pension by using the <a href="https://member.railwayspensions.co.uk/login" data-sf-ec-immutable="">pension planning tools in your myRPS account.</a></p><p>Here’s how being part of the RPS is already helping you save towards your retirement, and how you could save even more for your future…</p><h3><br>You’re increasing your savings with tax relief</h3><p>A fantastic thing about saving with your RPS pension is that its tax efficient, because the money you pay in is taken from your salary before tax is deducted. This means you pay less tax on your salary. Over the years this can add up to a substantial amount.</p><p>The amount of tax relief you get depends on the rate of income tax you pay. Basic-rate taxpayers (who pay 20% income tax) get tax relief at the same rate. If you’re a higher-rate taxpayer you get 40% tax relief, and additional-rate taxpayers get 45%.</p><p>For example, if you’re a basic-rate tax payer (who pays 20% income tax) and put £100 into your pension, it would actually only cost you £80. That’s because the other £20 comes from tax relief.</p><p>You can pay in as much money as you want into your pension, but there’s limits on the amount of pension savings that benefit from tax relief each year, before you have to pay tax. You can <a href="https://member.railwayspensions.co.uk/pension-essentials/pension-tax-limits" data-sf-ec-immutable="">learn about the limits, and watch a short video on how tax relief works on the Pension tax limits page</a>. <br><br></p><h3>You can pay more in with Additional Voluntary Contributions (AVCs)</h3><p>‘Topping up’ your pension with AVCs could help pay for your life after work. AVCs are extra contributions you pay into the Scheme, on top of the regular contributions you and your employer pay in while you’re working. </p><p>AVCs might help you save more, particularly if you’re thinking about taking your pension early, or before your State Pension Age (SPA). </p><p>You can pay in as little as £2 a week, and you can make one-off payments if you wish. If you earn extra money like overtime or bonuses, or if you receive a monetary gift, paying it into AVCs is an excellent way to boost your potential retirement savings. Plus, you get tax relief on the money you pay in, up to certain limits. </p><p>If you want to start paying AVCs, you should speak to your employer. Here’s where you can find more information:</p><ul><li>If you’re a defined benefit (DB) member, the main AVC arrangement is called BRASS. <a href="https://member.railwayspensions.co.uk/defined-benefit-members/saving-more-BRASS-AVC-Extra/saving-more-with-BRASS" data-sf-ec-immutable="">Visit the Saving more with BRASS page to find out more</a>. </li><li>If you’re an IWDC member, you can save more by paying more contributions. <a href="https://member.railwayspensions.co.uk/iwdc-members/Im-still-working/saving-more" data-sf-ec-immutable="">Visit the Saving more with Additional Voluntary Contributions (AVCs) to learn more</a>.</li></ul><p>The <a href="https://member.railwayspensions.co.uk/login" data-sf-ec-immutable="">MoneyFit tool in your myRPS account</a> can help you manage your money, and offer helpful tips to possibly free-up a little more to contribute to your pension savings.<br><br></p><h3>You can take control of your pension and plan for the future </h3><p>You can see how much your RPS pension might be worth when you retire using the pension planning tools in your secure myRPS account. If you haven’t already, <a href="https://member.railwayspensions.co.uk/register" data-sf-ec-immutable="">you can register for your myRPS account here</a>. </p><p>With an online account, you can request an estimate of your pension benefits quickly and easily. This will give you an idea of what your RPS pension might be worth, based on your current pension payments. </p><p>You can then try the pension planning tools in your account to see how saving more might make a difference to your retirement savings. Using the planning tools you can adjust the amount you pay in, and see how contributing more with AVCs could boost your savings. </p><ul><li>Defined Benefit (DB) members can use the Pension Planner tool.</li><li>Industry-Wide Defined Contribution (IWDC) members can use the Retirement Modeller.</li></ul><p> </p><p>*<em>Figures correct as at April 2024, but may be subject to change. Full details can be found at </em> <a href="https://www.gov.uk/new-state-pension/what-youll-get" target="_blank" data-sf-ec-immutable="" data-sf-marked=""><em>gov.uk/new-state-pension/what-youll-get</em></a><em>.</em></p>
The State Pension will increase by 8.5%, to £221.20 a week in April. But here’s why that might not be enough to make ends meet when your working days are over…
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