Paying into LGPS, considering AVCs but not sure

Gin_and_Milk

No, it was definitely on the Pru website in the LGPS / AVC bit, which is how I found out the forecast in one of my earlier posts. Thing is, I want an idea of how much I might get if I took it out over a shorter period of time, and I can't think of how I could get an estimate anywhere else online.

Was your AVC fairly straightforward to set up? I've also looked on my LGPS website and it's not there either!

snowqueen555

So can someone tell me the beenfit of AVC with LGPS over a SIPP?

Does the LGPS login show your AVC account, as my current LGPS online login doesn't seem to have this.

Gin_and_Milk

snowqueen555 wrote: »

So can someone tell me the beenfit of AVC with LGPS over a SIPP?

Does the LGPS login show your AVC account, as my current LGPS online login doesn't seem to have this.

My understanding of SIPPs is that you choose your own investments, whereas with an LGPS AVC you don't have to.

Whilst I have a small number of shares invested and I've just opened a Vanguard Life Strategy fund (paying £100pm), I'm not confident when it comes to paying into funds for a pension. Don't get me wrong, none of these options are guaranteed, but if I want to spread my options as much as possible and I'm only prepared to invest what I can afford. I'm looking to build up as big a lump sum as possible to help me retire early.

As far as I'm aware, if you have an ACV you can check online, my LGPS lets me look at my statements too. The next one is due in June, and I think this time it will give you an idea of how much pension you would get if you retired at 55, 60 and SPA.

Would love to retire at 55, but doubt I can though!

AlanP_2

snowqueen555 wrote: »

So can someone tell me the beenfit of AVC with LGPS over a SIPP?

Does the LGPS login show your AVC account, as my current LGPS online login doesn't seem to have this.

The big, big advantage is that the AVC can be taken tax free at the same time as main scheme benefits subject to being 25% of:

(20 * Annual LGPS pension) + Pre-2008 Lump Sum + AVC Pot


The LGPS login for your local admin area is unlikely to show anything re AVC pot as it is administered by a separate company (e.g SL or Pru) and not the LGPS team.

Mine is with Clerical Medical and I have no online or telephone access, my wife's is with Standard Life and have online access to that so can check value once a day if you want to.

AlanP_2

Gin_and_Milk wrote: »

My understanding of SIPPs is that you choose your own investments, whereas with an LGPS AVC you don't have to.

You need to select the underlying investments from those offered by your LGPS AVC provider. Typically it is a much shorter list than for a SIPP or similar.

PoorPaul

The more I read about the AVC through the LGPS, the less negatives I see - surely there must be some?
The ability to get tax relief on contributions and also take it out tax free (assuming under the 25% of the total fund) appears to be a 'win win' scenario.
So what are the downsides? Generally lower returns than you'd get elsewhere?

Gin_and_Milk

PoorPaul wrote: »

The more I read about the AVC through the LGPS, the less negatives I see - surely there must be some?
The ability to get tax relief on contributions and also take it out tax free (assuming under the 25% of the total fund) appears to be a 'win win' scenario.
So what are the downsides? Generally lower returns than you'd get elsewhere?

I think the main risk is that like all investments you could end up with less than you paid in, but like you say, there do seem to be a lot of positives.

Not sure why I'm dithering really, but there's lots of people on here who know way more about this sort of thing than I do!

OldBeanz

PoorPaul wrote: »

The more I read about the AVC through the LGPS, the less negatives I see - surely there must be some?
The ability to get tax relief on contributions and also take it out tax free (assuming under the 25% of the total fund) appears to be a 'win win' scenario.
So what are the downsides? Generally lower returns than you'd get elsewhere?

I think it was post 2 or 3 that I said an LGPS AVC was the icing on the cake of a golden pension.
Given that you are getting a 25% uplift, that charges (I assume here) will have been negotiated down and that the providers are main stream uk financial giants - it would be extremely difficult to find anything as attractive with such low relative risk.

geoffers4

snowqueen555 wrote: »

Does the LGPS login show your AVC account, as my current LGPS online login doesn't seem to have this.

No, I have 1 login for LGPS and another for Pru AVC. It's very handy to be able to login and see the current value if I took my pension today (I'm over 55) + the AVC lump sum. Both increase steadily each month I continue working.

Now all I have to do is figure out how much is enough...and persuade myself to pull the trigger!

snowqueen555

AlanP wrote: »

The big, big advantage is that the AVC can be taken tax free at the same time as main scheme benefits subject to being 25% of:

(20 * Annual LGPS pension) + Pre-2008 Lump Sum + AVC Pot


The LGPS login for your local admin area is unlikely to show anything re AVC pot as it is administered by a separate company (e.g SL or Pru) and not the LGPS team.

Mine is with Clerical Medical and I have no online or telephone access, my wife's is with Standard Life and have online access to that so can check value once a day if you want to.

It's a shame you can't take the AVC earlier. Are you able to take your LGPS pension early and keep the AVC going, or possible to take both the AVC and LGPS pension early?