AVC Pension

binnie

Hi, Looking for some advice please. My husband is 53, 54 in August and has taken voluntary redundancy and a private pension from his job. He also has some leftover AVC's in which he needs to buy an Annuity but we don't understand which is best. His works can't give advice and we rang the Prudential up for advice which they are relucatant to give. They were sending a financial advisor to our house to talk us through but two weeks have gone by and no phone call.

What we want to know is, if he signs up to an Annuity can he then withdraw all his pension pot under the new rules when he gets to 55.
We don't want to sign anything and tie it up permanently as it's only £150 a year.
The pension pot itself would be more beneficial to us if we could take the whole lot out.

Thanks in advance

kidmugsy

binnie wrote: »

What we want to know is, if he signs up to an Annuity can he then withdraw all his pension pot under the new rules when he gets to 55.

No; if you hope to withdraw the "pot" don't buy an annuity.

binnie

Hi and thanks for your reply.
What does he have to do with the money the AVC,s, will they just sit there until he decides.

dunstonh

What does he have to do with the money the AVC,s, will they just sit there until he decides.

It will remain invested until a decision is made.

binnie

Thanks so much. We thought because it was AVC's that he had to make a decision now or lose the money

dunroving

binnie wrote: »

Thanks so much. We thought because it was AVC's that he had to make a decision now or lose the money

It depends on the scheme and when he wants to take the defined benefit component of the pension. Some schemes require you to do something with money-purchase AVCs (buy an annuity; cash them in, for example) at the same time as you take the final salary pension.

The rules governing what he can do with the Pru AVCs might be explained in his company pension regulations (and may be why Pru is reluctant to tell you anything definitive). I know mine are, and I can't take/use one without the other. This may not apply to his situation but is worth looking into.

binnie

But we don't know how to look into it that's the problem as his works aren't helpful and the Prudential aren't. We don't know who to turn to. When the Prudential first said they can't send someone to the house I then googled it and found you could I rang them and they said yes they can send a financial advisor, but he hasn't rung and we don't know if we can use an independent one or not. For £110 a year we didn't really care about being paid yearly. Sorry I put £150 a year earlier but it's actually only £110. How can we find out the actual rules.

greenglide

Could citizens advice (CAB) or similar be able to help?

Presumably "advice" from Pru would either be a salesman or would cost?

Ultimately you may require the services of an IFA but the costs may be prohibitive?

dunstonh

is works can't give advice and we rang the Prudential up for advice which they are relucatant to give.

It isnt that they are reluctant. it is because they cant give advice either.

But we don't know how to look into it that's the problem as his works aren't helpful and the Prudential aren't.

That is because neither have the authorisations to give advice.

They were sending a financial advisor to our house to talk us through but two weeks have gone by and no phone call.

Prudential don't have any financial advisers. They may have passed your enquiry onto a firm or two via unbiased. However, given the size of the pot, it is probably uneconomical for an adviser to give you advice.

Maybe wait until the new tax year and then ask them about full fund withdrawal (given the small value, it is unlikely to be an issue)

jem16

binnie wrote: »

How can we find out the actual rules.

What pension scheme is your husband a member of?

When you say "leftover" AVCs did he use some of his AVCs to fund his tax-free lump sum or is it just an AVC pot?

xylophone

https://forums.moneysavingexpert.com/discussion/comment/65245237#Comment_65245237

Hi, By the time he retires which will be in October, he would have earned about £20,000 ish to which he pays tax on every week as he gets paid weekly.
Where he works, they can claim a pension at 50 and we have decided to take the lump sum and a reduced weekly/annual pension.
We are buying a property in Spain so wanted the money now rather than take a large annual pension.
He won't be working again

Thanks for your help

Your husband retired last October at the age of 53.

His job had a protected retirement age of 50.

Were these AVCs to this company pension or to a separate scheme?

Why were they not taken at the same time as the pension/redundancy lump sum?