Should I move my Free standing AVC

innit

The advice was on a servicing contract

dunstonh

As you have been paying for reviews and not getting them then you may well have a case. Take a look at your fee agreement and see what it says what services you are getting.

innit

dunstonh wrote: »

As you have been paying for reviews and not getting them then you may well have a case. Take a look at your fee agreement and see what it says what services you are getting.

The Actuary was looking at pre 2006 rules,my employer has issued me with a letter of confirmation that they do request you to reduce or stop your funding near the inland revenue limits,this is laid down by HMRC,and all overfunding has to be refunded?

Also the advisor stated my money was better in an ISA for better returns and tax reduction? i think this is not true,as my avc one year alone made 30% and has continued to make an average of 10% far outweighing any tax implications or even the tax relief we get,my salary has also inreased from the time of the advice from £30,000 upto £43,000 so the upper limit set at the time which i think was 15% could never have been reached and is even further now as i am told the limit is 1.5 million

dunstonh

Also the advisor stated my money was better in an ISA for better returns and tax reduction?

Returns make no difference as the same investment funds exist for pensions and ISAs. That is with the exception of legacy insurance company investments which can be a bit poor on older style plans. So, you cant say ISA is better than pension for investment choice or vice versa as that is effectively identical (or as close as makes no difference).

If your income was on track to be just above the age allowance reduction figure, then ISAs can be more favourable than pension as the pension income would not only be taxed at 20% but also reduce your age allowance by £1 for every £2 over the limit until the age allowance is wiped out. Income from ISA does not exist in the eyes of the tax man so would avoid that from happening.

Pre 2006 you had no lump sum entitlement on the AVC. Post 2006 you did. AVCs largely went obsolete post 2006 with personal pensions and ISAs looking like the better option unless the AVC matched contributions or the ability to use the AVC to pay the lump sum instead of the main linked scheme.

Nothing beats employer matched contributions. Its free money.

innit

My avc was being matched pound for pound,so the £20 per week i was funding was being matched by £20 per week by my employer £160 pcm.