AVCs on husband's pension or PRSA for me?

3

3dolls

Registered User
Messages
38
Situation is this:
Husband - defined contribution pension scheme, currently not making AVCs.
Me - made redundant last year, DB pension, which is apparently going to be wound up in the next while.

When I was made redundant, the pension was paid up (is this the correct term?) - I left it where it was cos wasn't sure what I was going to do. I've been at home since, and realistically will probably remain at home for a few years as we have young children. This will obviously impact my finances at retirement, as when I do go back into the workforce I'll have a number of years to catch up (and will probably be starting back on a low salary).

We're going to clear the mortgage in the next 2-3 months which frees up some of our monthly income. The question we face is - should we do AVCs into his pension, or start paying into mine when I decide what to do with it (PRSA or whatever). Obviously there would be a tax benefit to Mr 3dolls. As I'm not currently working, and therefore paying no tax, does this mean that I wouldn't get any tax benefits on any contributions I would make?

Would it be foolish to put all our money into his pension, possibly leaving me destitute in my old age?! I'm just trying to look at all eventualities....
 
Last edited:
Re: AVCs on DHs pension or PRSA for me?

Under an AVC your husband could opt for an approved retirement fund at normal retirement age which would pass onto you on his death.

Another option would be to put your contribution into a regular savings plan and when your back at work you could put the proceeds into a pension plan as a single premium for tax relief within the limits. I can't see the logic in putting money into a pension plan now without getting tax relief.
 
Re: AVCs on DHs pension or PRSA for me?

You can contribute money to a PRSA now and then claim your tax relief when you eventually go back to the workforce. However if your partner is a higher-rate taxpayer now and you're a lower-rate taxpayer when you return, it would be more tax-efficient to put the money into your partner's pension and claim the relief at the higher rate.
 
You must log in or register to reply here.
Back
Top