Debt and AVC

RhiBi

I’m not sure if this is the right place to ask this, so feel free to move it if not.

As most of you know I have stopped paying my non priority debts and waiting for them to default before setting up a self managed DMP.

im 53, and having taken about 13 years off work whilst my children were young, I won’t have a great pension when I retire.  I have thought for a while of paying into an AVC through work (local government} and am wondering if now would be a good, or a bad time to do so.

My thoughts are that whilst I am waiting for defaults, I will be building an emergency fund, and in some ways can afford to take the hit in a lower monthly wage.  It would mean that when I am in a position to arrange token payments, they would, however be lower due to my take home pay being lower.

If anyone has any advice either way I’d be grateful.

Thanks!

ManyWays

The idea about paying lowish payments in a self managed DMP is that you save up the extra to make settlement offers on your debts.

You have 38k of debts and you own a house with no mortgage.  You have to take clearing these debts seriously, they need to go before you retire. 

If you are making the normal contributions to the LGPS, I suggest that you cannot afford AVCs in addition.

RhiBi

Thank you, I am taking it seriously, it was just a thought about my future longer term.  I didn’t know if it was a good idea or not, which is why I thought I’d ask here, before making any decisions.