SIPPS - Not for people like me who like watching paint dry !

ukpoker

pafpcg wrote: »

PS: I'm puzzled by your claim regarding your Aviva pension that you "have NO clue as to its value" when you stated in your earlier post (#3 yesterday at 3:21pm): "I have a Section 228 policy with AVIVA ....... and will receive approx £12-£15k a year from".

Simples...they won't give you a value on the fund as its part of a bigger pot, as I understand it, so therefore as an individual there's no value until it comes time to pay out.

Its currently structured as :

Assured value = £60,000 +
Acc. Bonuses = £44000 (as at 1994) +
Terminal Bonus (Between 20-50% of total fund at time of retirement)

My estimation is that the fund will be worth between 120k - 150k in Oct 2021 at which time I'll be eligible for the 9.8% GAR as was specified on the policy at the outset. Hence my £12k - £15k per annum forceast of a pension at that time.

I won't know the value till April 2021 at the earliest !

dunstonh

Simples...they won't give you a value on the fund as its part of a bigger pot, as I understand it, so therefore as an individual there's no value until it comes time to pay out.

There will be a transfer value. There may not be a current value if it is a conventional with profits plan but you can easily compare the current position with the transfer value on those. Aviva give you the terminal bonus that has accrued to date on most of their plans. Although it may not appear on the statements or it may be factored into the transfer value (which you then compare to the current position).

atush

Exactly, they will give you a CETV if you ask them.

But I pray you dont.

as you would just gamble it away

Malthusian

Atush beat me to it. The poster may have said "I'm going to draw the guaranteed annuity with Aviva at age 60" but he has a history of saying he is going to pursue one strategy with fund A and a higher risk strategy with fund B and then changing his mind and making bigger bets with fund A to try and recover losses made on fund B, resulting in him losing fund A as well.

So in that sense some might say that you shouldn't tell him that he can get his hands on probably a six figure sum from his guaranteed Aviva pension. Not me though, my view is that if someone makes a bad decision on good information then the person is at fault, not the information.

Incidentally OP, you said in 2009 that the GAR was 11% but you now say it's 9.8%, what happened to it?

ukpoker

Malthusian wrote: »

Incidentally OP, you said in 2009 that the GAR was 11% but you now say it's 9.8%, what happened to it?

Taken from an article from the Daily Mail 'This Is Money' I found searching on 'GAR returns from AVIVA policies'...

Male GAO Current annuity rates
Age 60 £9.43 £19.19
Age 65 £8.16 £17.13
Age 70 £6.82 £15.12

So its actually 9.43% and not 9.8% as stated. Sorry about that!!

An interesting question was raised in the same article...

Q6. What proportion of GAR policyholders who have reached retirement age in the last year have exercised their right to a GAR?
It would be fair to say that the majority of customers (if not all) would avail of a rate on offer higher than current annuity rates. Due to the current economic environment, and by looking at the examples above, this shows that most would offer better rates than a typical annuity at the present time.

:j:j:j:j:j:j:j:j:j

dunstonh

Dont rely on the Daily Mail for your data. You should never rely on the DM for anything other than a reminder as to how poor journalism is today.

Aviva are a collection of many different insurers. Over the years, each legacy insurer would have had different versions of the plan and each tranche would have had its own levels of GARs. Also the terms of the GAR would vary (e.g. 100% spouse being different to 0% spouse).