Hi Rainy
That looks like a good deal - when we ran figures there (a few months ago) it showed a 1% AVC for a 40 year old male up to age 65 would purchase an estimated pension of 1.6% of salary at retirement (this is with 50% spouse pension, no pension escalation, retirement age 65).
In your example - your are getting a 1.67% GUARANTEE pension (with spouse pension I presume?, with escalation I would imagine in line with state pay increases?, with retirement age 60?) and you are only being asked to contribute about 0.8% of salary - even less cos some of this based on pensionable salary.
Is the retirement age 60?
If so the deal is excellent.
Hi guys,
This query is following on from some information in one of the key posts. My wife is currently in the same situation and is just about to sign the forms for NSP to replace her Cornmarket AVC (I had some posts about this a few weeks back). Anyway Im just running through things once more before she sends it off. She is now 32 and her contribution rate to buy back each year is 0.13% of gross and 1.09% of net. This works out at 0.99% of gross over all and from what you've said she's paying this for a 1.67% GUARANTEE pension (from what I can work out your 1.67% comes from the fact that her overall pension if she has 40 years service is 66% of final salary so each year is worth 1.665% of final salary).
My employers pension managers recently gave a presentation where they indicated that a 1% AVC for a 30 year old person should buy a 3% pension. If this is in fact the case does this make the NSP seem quite expensive? I know the guarantee is worth a premium but is this too much?.
Thanks,
Warren