Understanding AVCs help

cloud_dog

LGPS or rather councils are rather large employers taken as a whole, I wonder if AVC payments benefit from beneficial charges from the Pru?

Or, are you able to buy extra years with LGPS (assuming you think you may remain for a period).

We need someone like.... SilverTabby to come along, they will definitely be able to help.

zagubov

I think AVCs are fully inheritable but added past years only partially are. In some pension schemes the widow receives half their spouses pension when they die. If that's the case in your pension only half the past added years would benefit your survivor.

bonnyrigger

I started the LGPS Pru AVC in August 2018, £1100 (11x£100) invested to date, just about to double it to £200 and hopefully so on. Net cost to me is £869 with 21% tax relief, invested 50% UK passive equities, 50% Overseas passive equities. Current value is £1208, which is a good rate of return on my £869 - although I do realise equities are probably due for a correction.
I'll be paying into this for 5 more years and hope to have it at about 25% of the value of my LGPS DB pension by then - it will then remain invested without contributions for another 5 years until I actually draw my LGPS DB pension.
Most of the people I work with are investing in one or other of the LGPS AVC options.

AlanP_2

Our LGPS offers a Standard Life AVC and doesn't use Pru. Headline charge %'age is reduced so would hope your LGPS has a similar arrangement with the Pru.

Don't forget even if the charge was 5% or something similarly ridiculous you would still be quids in as you get tax relief on way in and tax free on way out, that's if you assume growth in investment values matches inflation.