Taking maximum tax free benefit from extra pension investments

artha

I've posted several threads before on my impending early retirement options so those who have kindly responded to those,thanks, but please be patient.

I want to take voluntary severance next year (August 2nd)if possible while an opportunity currently exists. (Reasons for this date are too detailed and possibly irrelevant to this post)

From various sources including contributors to this site I have learnt that my AVC contributions, which come together with my main scheme pension at retirement early or normal,will be my most efficient source of tax free cash if I choose to take it. Unfortunately my AVC s are in Standard Life with profits and Standard Life Stock Exchange One Fund. The former will be subject to a significant MVA if I take it early or transfer to another SL fund now or later. The latter is at a very low value and could get worse/better depending on the markets over the next 6 months or so.

Just needed to clarify on edit that I don't intend to transfer existing funds elsewhere

I have decided to stop paying into existing funds and put further contributions into the Standard Life Sterling Fund i.e. cash. I am intending to put in the amount that would take me down to the net income I would receive once retired to test whether I can live on this income before making the big decision. This amounts to a contribution of £1400/month into the cash fund.

Since working out this option I have asked myself whether there are any other options.

My questions are:

Does my current logic make sense?
Is it possible to leave my current AVC fiund to improve and take pension buy back at later and put a large cash injection into something else pension wise that receives the same tax relief and can be drawn as tax free cash in August 2009?

artha

sorry just bumping myself up. Lots of views but no comments?

Day_Trader

Logic makes sense. Not sure what your second question means though
Are you asking if you can take a pension from your AVC and recycle the money into another scheme?

artha

Day_Trader wrote: »

Logic makes sense. Not sure what your second question means though
Are you asking if you can take a pension from your AVC and recycle the money into another scheme?

On the second question I meant that I would leave my avc as it was and start putting any future contributions into another tax free pension wrapper that could be taken as tax free cash at thetime of retirement - I didn't think I could but was just checking that I hadn't missed an opportunity