what to with an unwanted free standing AVC

rooster

I currently have a HSBC free standing AVC with a about £5000 in it, which I no longer contribute to. I have an excellant NHS pension and took out the HSBC AVC after some dodgy advice from a friend. However, I now have no idea what the best option is for the £5000 sitting with HSBC. any suggestions?

dunstonh

I have an excellant NHS pension and took out the HSBC AVC after some dodgy advice from a friend.

FSAVCs have actually gone from being a lesser value option to quite a valuable option post A day.

However, I now have no idea what the best option is for the £5000 sitting with HSBC. any suggestions?

It's £5000 invested tax free so you treat it like an investment.

rooster

hi Dunstonh,
In that case is it worth contributing a monthly amount into it? What did you mean treat it as an investment? will it in gain in value and won't be eaten away with charges( I know that sounds a dim question I'm a pension iliterate)

dunstonh

In that case is it worth contributing a monthly amount into it?

With an occ scheme running, you may find stocks and shares ISAs offer the best option or perhaps contributions to your spouse's pension depending on what their retirement provision is.

What did you mean treat it as an investment?

You have £5000. You need to think of this as £5000 to invest. Not an unwanted FSAVC. So, more effort needs to be spent on how and where it is invested.

will it in gain in value and won't be eaten away with charges( I know that sounds a dim question I'm a pension iliterate)

Charges tend to be a percentage of the value each year. Ranging from around 0.6% to 1.5%. Performance will depend on how you invest but a decent medium risk spread would be looking for 10% p.a. over the long term. So, the charges wont eat away the value. Providing it is invested correctly.

EdInvestor

What is it invested in now? What other fund choices are there? What charges are you paying?

These are the questions to ask.