The implications of transferring additional voluntary contributions

There is a new information booklet for members who have made additional voluntary contributions (AVCs) to their pension scheme.

Many members enhance their pension funds by making AVCs, either with the Prudential through the Teachers' Pension Scheme (TPS) or with a free-standing provider. Since last year it has been possible to transfer these funds into a private pension scheme.

The DCSF recently expressed concern that a number of TPS members have been encouraged by financial advisers to transfer their Prudential AVC funds into self-invested personal pensions (SIPPs) without being given enough information on how this could affect their pension in the long-term. In response, the actuary firm Hewitt was asked to provide independent financial guidance on the implications of transferring AVCs.

The resulting booklet, Additional Voluntary Contributions: Options for those currently contributing to the Prudential AVC facility, is available from www.ascl.org.uk by logging into the members' area and clicking on 'guidance' and 'pensions'.

ASCL's premier partner Frizzell can offer members independent financial advice through its preferred provider, Lighthouse Temple. For an initial, no obligation consultation call 0800 982 289. Lines are open 8am - 8pm Monday to Friday and 9am - 1pm Saturday.

Alternatively, an organisation called IFA Promotion can provide details of IFAs in your area. They can be contacted on 0800 085 8590 or at www.unbiased.co.uk