Changes to Prudential Local Government AVC s – Exit ChargesFebruary 21, 2017
In December 2016 the Department of Work and Pensions released new regulations regarding the level of exit charge allowable to members over the age of 55. The regulations stipulate that exit charges should change as follows:
- New members who join post 1 October 2017, and are over the age of 55, no exit charge can be applied to their fund. For existing members over the age of 55 the exit charge is capped at 1%.
The Prudential currently apply an exit charge to members who take their benefits, or transfer out, within the first 3 years of making their first contribution to their AVC. From the 19th March 2017 this will change as follows:-
- Members whose first contribution is received on, or after, the 19th March 2017 will no longer be subject to an exit charge regardless of age. Due to the time that elapses from a new application being processed, instruction being sent to payroll and first deduction being sent to Prudential, this effectively means that any new applicant from today will be exempt from any exit charge.
- Members whose first contribution is received prior to the 19th March 2017 will have their exit charge capped at 1% for the first 3 years and 0% thereafter regardless of age.
To find out more about AVCs, please visit the Prudential’s website at www.pru.co.uk/lgsite.
Alternatively, you can call the Prudential’s Retirement Specialist Team on 0800 028 1493. Lines are open Monday to Friday, 9am-6pm. They can’t give you advice but they can give you further factual information, chat to you about your personal situation and help answer questions you may have about AVCs.This entry was posted in AVC (Prudential). Bookmark the permalink. ← Topping up your State Pension How do the contributions I pay into the LGPS each month relate to the pension I build up? →