Should I keep on paying AVC's?

Kathy22_2

I'm a teacher, aged 58 and could retire on State Pension when I'm 60 yrs and 8 months, so about 2.5 yeras to go. I've been paying into the Teachers Pension Scheme for 14 years as well as paying over £250 per month into Prudential 'With Profits' AVC's for the same period (Prudential is the approved linked AVC provider).
As the stock market has plummeted, I'm wondering if AVC's are the best way of enhancing my pension. Is there a better investment I could be making with my £250 per month?
Apart from the State Pension I will have no other income. I've looked at buying additional pension through the Teachers Pension Scheme but it is far too expensive - to get an additional £250 per year it will cost over £5,000 lump sum (more if I pay monthly).

dunstonh

As the stock market has plummeted,

In 2001/2 the stockmarket dropped by a similar amount. What did you do when it happened that time?

Plummet is media speak. It would be similar to saying that the stockmarket has boomed in the last 2 months as its up 16%.

Your problem is that you dont have long to go and utilising investments is high risk on the assumption you will be taking the AVC at the same time as the occ scheme and not deferring it to take later.

LizzieS_2

As you are so near retirement, speak to the Prudential as 'with-profits' is more risky than say a 'building society' type investment route.

No-one can say whether it is better to carry on paying or cease paying as many factors are unknown. The only known definate is that you are saving 20% income tax on every £250 paid.