AVC at 60

[binny]

Morning
Just looking for some advice regarding my avc I have 1 flexi plan and 1 Bouns plan due to mature Oct.
Not sure what to do with them
Draw Down
Annuity
Or take Royal Mail offer

Any Help
Will be Much Appreciated

Thanks

[RobertT]

It sounds like you're in section C?
If so, AVC's are designed to fund the tax free lump sum with particularly your NRA60 benefits(DBCBS is for NRA65). That way, you don't have to give up as much or possibly any pension, to get that lump sum.

If you're able to take them all tax free with NRA60 then go for that. If tax is likely to be an issue then transferring might be a better choice, but only if you can pay less tax by doing so.

You also need to ask yourself what you want to do with the money. For example: If you want it to pay off your mortgage, it's not much use transferring and buying an annuity.

[binny]

Thanks for your reply yes it does fund my pension to max and some extra cash but I work it out to get my money back I would need to live til 89
yes you are correct c pension
thought might get a better return for my avc in some over way .
no mortgage

[binny]

what happens to your AVC when you deffer it ?

[RobertT]

If you want the maximum lump sum possible, section C members can also fund their 25% tax free lump sum by giving up some pension. AVC's are then either paid out as a lump sum with 25% of that being tax free, deferred or transferred.

If you defer taking your AVC, your cash will still be invested as per your choices. But all you're doing is putting off the decision on what to do with it.
Transferring gives other options such as different investments and when/how you access the money.

The pension will be inflation linked and the compound effect will grow your income over time. So the higher the starting amount, the higher the annual increases will be.

Personally I plan to use my AVC's to fund the tax free cash(with max NRA60 pension) and transfer the excess for drawdown.

Everyone's situation is different and there's several options available to you. So my advice is to take your time and make sure you're doing the right thing for you and your family.

[binny]

Thank you much appreciated
for your advice