That's a shock to me too. I always assumed that whatever pension contributions you made (and NSP too) would be paid on death -at whatever age- to spouse/children.From my research a big shock to me was that NSP amount you have payed in will be lost if you die prior to retirement while an AVC or PRSA will be payed on death.
I'm and C and C teacher. Will have 40 yrs service at 62 and have been buying those 2 years through notional service. Am 51 and now intend to retire at 55 or 56 [if the good lord spares me!] I will have purchased about a year of the two at that time and that will be allowed in my pension calculations. e.g service at 55 = 33 yrs + 1 yr notional service = 34 yrs. I am not sure if i can purchase the balance of the two years at that time by lump sum but have been advised that i can do so out of my AVC fund.
I will use my AVC to [1] bring my gratuity up to the full amount, [2] perhaps, if allowed purchase the missing notional service, and [3] the balance will supplement my pension.
In general i believe that it is better to purchase notional service before AVCs but this might not apply in all cases and you have to allow for the fact that AVC funds have not been performing very well.
If you have 40 yrs and 9 mths at 65 and you are able to purchase notional service from 60 you should be able to buy 4 yrs and 3mths.
Hope this helps?
Well done on an informative thread. Like Cord I intend to 'bail out' with 33yrs service aged 55yrs, 2 yrs for degree.(I am 35 now). I can buy 1 year NSP, and I am paying into a Marsh AVC for now anyway, but my query is, Is it a good idea to let my employer know I intend to go early at this stage, Please explain what 'applied a reduction on your purchased added yrs' stated by Mula above means.you can purchase nsp with your avc but the fact that your goin early im nearly sure rules this out. have you informed your dept your goin early have they applied a reduction on your purchased added yrs?
Well done on an informative thread. Like Cord I intend to 'bail out' with 33yrs service aged 55yrs, 2 yrs for degree.(I am 35 now). I can buy 1 year NSP, and I am paying into a Marsh AVC for now anyway, but my query is, Is it a good idea to let my employer know I intend to go early at this stage, Please explain what 'applied a reduction on your purchased added yrs' stated by Mula above means.
Thanks for the reply. This is exactly what I intend to do ,God Willing. I am paying in to an Marsh AVC at the moment also, to try make up whatever difference their is going to be.if you purchase service that your short at 60 let say but intend to retire at 55 then the dept will apply a reduction on the yrs you have actual bought at 55.
mula
Hello all again!
Just to update the thread and share what I am doing, probably hoping that someone might say that it's the correct way to go!!?? I have (next week) frozen my Marsh AVC, (wrong word), stopped paying it to it. I had contacted Marsh about transferring costs, there are none, I was told. They seem a little bit better versed than two months ago. I still can't help feeling that the unions are getting some %, but that's another story being followed else where!! I have (next week) begun to buy some years back(NS), to be more accurate 5.0794 years at a cost of 2.10% per year, per year, allowing me to jump at 60. But my nice employers know that I want to retire at 58, so they quoted me a reduction from the mentioned to 3.6696 years pension and of 4.0378 years lump sum. Good ? Bad? Here's another question, so I will be short 1.4098 years at 58, can I buy those years with my lump sump?? But then I kick the bucket at 57 and there goes all that planning!!
Thanks Mula. I know I am going on about this, but it keeps the brain active!! Can I buy the 1.4 odd years at 60, having still retired at 58?
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