Using your AVC

The Government has introduced new legislation which will affect you if you have an AVC in the LGPS. The new regulations mean that we have to contact you before you take your benefits to ensure that you are aware of Pension Wise guidance prior to taking or transferring your AVC.

Pension Wise is a service from MoneyHelper. It is a free, impartial service sponsored by the Government.

What happens

If you are:

  • taking payment of your in-house AVC or
  • you are over 50 and you want to transfer your AVC to a defined contribution* pension scheme in order to access your money

then we will offer to book you an appointment with Pension Wise.

*A defined contribution pension is one that is invested in your chosen funds in the financial markets.

Pensions wise appointment

If you would like us to book an appointment, you will need to tell us when and how you would like the appointment. We understand that Pension Wise are only offering telephone appointments at present, unless you have accessibility needs that require a video or face to face appointment.

If you prefer to book the appointment yourself, you can do this by telephoning 0800 100 166 or booking online at www.moneyhelper.org.uk/nudge-public

Once you have received guidance from Pension Wise, you will need to let us know.

If you do not wish to take guidance, you can opt out.

Important: We cannot proceed with your application to take your AVC until either: 

- you have received guidance from Pension Wise or
- you have opted out of receiving guidance.

This is a legal requirement.

Transferring your AVC to a defined contribution scheme

If you are transferring your AVC, you will not be required to take guidance from Pension Wise or opt out if:

  • you are under age 50 or
  • you are not transferring in order to access your benefits or
  • you are transferring to an occupational scheme which confirms to us that they have referred you to Pension Wise or
  • you are transferring to a personal or stakeholder pension scheme which is regulated by the Financial Conduct Authority (this includes a SIPP).
Opting out guidance

We strongly recommend that you receive guidance from Pension Wise.

However, you can contact us either in writing or verbally to confirm that you wish to opt out of an appointment with Pension Wise.

Opting out must normally be done in a separate communication:

  • In writing - please use a separate sheet of paper for your request.
  • Verbally - your telephone call must be to opt out only. No other topics can be discussed.

A separate opt out is not necessary if:

  • you are transferring your AVC or
  • you confirm to us that you have received guidance from Pension Wise in the last 12 months or
  • you confirm that you have received regulated pension advice in the last 12 months or
  • you left before 1 April 2008 and are accessing your pension as a serious ill health lump sum.
Pension Wise guidance

Pension Wise will discuss five options with you:

  1. Retire later or delay taking your pension pot
  2. Get a guaranteed retirement income (annuity)
  3. Take your whole pension in one go
  4. Get a flexible retirement income (pension drawdown)
  5. Taking your pension as a number of lump sums

However, the last two options are not available to members of the LGPS. You should check the letter which we send you setting out your AVC options at retirement to find more information on your choices.

Further help

You can obtain further guidance from MoneyHelper. This is a free, impartial money and pension service sponsored by the Government. It is separate from Pension Wise.

We recommend that you also consider getting independent financial advice. Help with finding an independent financial adviser is available at: www.moneyhelper.org.uk/en/getting-help-and-advice/financial-advisers/choosing-a-financial-adviser