What is the best thing to do with my freestanding AVC"s

enchated1

I have £28K in freestanding AVC's. I've had a little google around and looked at pension-wise and have come to the conclusion that I would be best to invest this money in a SIPP with Best Invest after taking a 25% tax-free lump sum.

Would you agree? If not what would you suggest?

dunstonh

FSAVCs were abolished in 2006. They were all reclassified as personal pensions.

I've had a little google around and looked at pension-wise and have come to the conclusion that I would be best to invest this money in a SIPP with Best Invest after taking a 25% tax-free lump sum.

Would you agree? If not what would you suggest?

You have given us nothing to go on. No reasons on why you think a SIPP is appropriate for you. No mention of any investments you would be using. Why that particular provider, no mention of why you need the 25% and what you are going to do with it. No mention of what you have and why you think it is not suitable and no mention of why you think none of the alternatives are unsuitable.

So, we can neither agree or suggest anything.

So, rolling things back a little bit, and noting what I have said, why do you think it is right?

enchated1

Thank you for your reply.

To be honest I have no idea - I don't have much knowledge but I'm happy to have a go at this myself to save FA fees.

I could invest the lot in an annuity and get £104 per month forever. I just thought I could do better with a SIPP and take the 25% tax-free lump sum. Maybe I'm wrong.

I was reading that you should take the 25% lump sum. Looking at the returns on annuities this seems worthwhile so I just thought that it was a good thing to do. I will most likely reinvest this in an ISA or something similar but I could leave it in the SIPP.

I have to do something with these AVC's Annuity's don't seem to offer a good return so I thought that a SIPP would be better. I haven't considered the investments atm. I read somewhere that the Best Invest SIPP was good for those who haven't got a lot to invest in a SIPP.

dunstonh

To be honest I have no idea - I don't have much knowledge but I'm happy to have a go at this myself to save FA fees.

Are you saving money though? Someone posted in the investments forum last week that they were going DIY and had selected best invest and was using the pretty naff an expensive best invest portfolios. They had higher charges than most adviser arranged investments.

DIY works when you know what you are doing and do it well.

I was reading that you should take the 25% lump sum.

If you were buying an annuity and there was no guaranteed annuity rate, then you should take the 25%. If you are not buying an annuity and there is no immediate reason to take the lump sum then you shouldnt.

I have to do something with these AVC's Annuity's don't seem to offer a good return so I thought that a SIPP would be better.

How about deferring the pension? Not saying that is best but it is an option that needs to be considered. Not all legacy pension schemes are bad value or poor quality.

I read somewhere that the Best Invest SIPP was good for those who haven't got a lot to invest in a SIPP.

That is only one part of the equation. The most important part is where you invest it. So, what did you have planned?

maximumgardener

how old are you?

married ?

age of spouse?

any dependants?

atush

To be honest I have no idea - I don't have much knowledge but I'm happy to have a go at this myself to save FA fees.

You have no idea, so why not pay the IFA who does? Isnt that what you would do if you needed electrical or plumbing work? hire someone to do something you have no idea how to do?

I could invest the lot in an annuity and get £104 per month forever. I just thought I could do better with a SIPP and take the 25% tax-free lump sum. Maybe I'm wrong.

Even with an annuity, and IFA could get you better than you can get yourself.

Not to mention, a sipp can only provide an income depending on how you invest the proceeds. Do you know how to do this w/o advice? What assets/funds would you choose?

xylophone

and IFA could get you better than you can get yourself.

An IFA for a pot valued at £28,000?

This seems a touch of overkill.

The OP has not stated what other pension provision he has.

atush

Probably, but at least he would ask about health.

Too many DIYers dont get enhanced annuities even when they qualify.

Basically, you missed my point. In that someone who knows nothing, needs to pay someone who does.

enchated1

maximumgardener wrote: »

how old are you?

married ?

age of spouse?

any dependants?

I'm 59 single no dependents

enchated1

atush wrote: »

You have no idea, so why not pay the IFA who does? Isnt that what you would do if you needed electrical or plumbing work? hire someone to do something you have no idea how to do?



Even with an annuity, and IFA could get you better than you can get yourself.

Not to mention, a sipp can only provide an income depending on how you invest the proceeds. Do you know how to do this w/o advice? What assets/funds would you choose?

To be honest I'd do my own plumbing and electrical work - I'm like that.

The quotes from FA seem low to me. I've already got my own quotes for annuities and beaten every FA quote.

enchated1

xylophone wrote: »

An IFA for a pot valued at £28,000?

This seems a touch of overkill.

The OP has not stated what other pension provision he has.

I'm a girl btw.

I have a small teacher's pension which will earn me £460 per month