What I get from my AVC account
The value of your Additional Voluntary Contributions (AVCs) account will depend on:
- the amount of AVCs you have paid in
- the investment returns
- the length of time your AVCs have been invested.
At retirement, your AVC account can be taken as extra Lump sum or used to buy pension benefits.
Currently AVCs can be taken as cash up to 25% of the available Lifetime Allowance, even if you started paying AVCs after 8 April 1987. The Company can remove this option for NAPS members who started paying AVCs after 8 April 1987, but any change would only take effect after an appropriate notice period being given to the Trustees and would only affect any future AVCs paid after the notice period has expired.
Alternatively, AVCs can be used to buy extra pension, called an 'annuity'. An annuity from NAPS can be provided in respect of any funds of a member who left the Scheme before 1 April 2007 or funds of less than £1000. For members who leave after 1 April 2007, the Trustees have appointed an annuity broker, Hargreaves Lansdown, to provide quotations on the annuities available in respect of funds exceeding £1000 as annuities are not provided via NAPS in respect of larger funds
As an alternative to these options, all NAPS members have the right to use their AVC fund to buy an annuity at a current market rate from an insurance company of their choice - known as the 'Open Market Option'.