AVC additional family benefits?

T

trumpet

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I've just seen this on Cornmarket web site:- 'You can also use your AVC plan in the years prior to retirement to provide additional benefits for your family in the event of your death. These benefits include:
A death benefit of up to 2 ½ times your annual salary, An additional pension for your dependants'. Is this option only with Cornmarket AVCs as I'm looking at going with a Zurich product via LABrokers. Any advice would be appreciated.
 
In the event of your death, the death benefit payable under an AVC is the same with any AVC - Cornmarket or LABrokers. If the Cornmarket website is referring to an additional Death in Service benefit (a form of additional life insurance contract) then this would be a separate product to your AVC.
 
The Cornmarket comment is I think made in the context of Civil Servants. Typically on death the CS Pension Scheme pays 150% of Salary as a lump sum. The Revenue maximum is 4x Salary. That’s where the 250% reference comes from. Any AVC fund can be payable in addition to the 150%.
However I think it would be very unusual to plan for the AVC fund being a death benefit, since it requires you to die before reaching retirement age?????
 

Is it not based on the tax free lump sum that would have been payable with a minimum amount of 1 times salary. They also get a spouse's pension too.


Not sure about the Cornmarket marketing bit. The maximum lump sum is 4 times salary plus the value of any personal contributions, including AVC's. So the AVC amount would be paid out tax free regardless and has no bearing on the 4 times salary amount.


Steven
http://www.bluewaterfp.ie (www.bluewaterfp.ie)
 
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