How will the new proposals of the five per cent charge to money purchase accounts affect the amount that I have contributed to AVCs?

All money purchase account balances, including AVCs, will be impacted by the 5 per cent charge at retirement to finance the non-reduction guarantee. Note that AVC balances (as well as Past Service and Special Vested Contributions) are currently reduced by 1.5 per cent when converted to pension for the same reason, and which matches the 1.5 per cent that the university contributes monthly in respect of required money purchase contribution accounts.

Posted in: The Pension Puzzle: Ask Bob! Part 2

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