In Reply to: Protect your Equitable Life AVC fund by ... posted by Deborah Young on 19 August 2002 at 15:51:43:
It seems that this really is not a practical possibility after all - see note below from Adrian Furnell. Sorry if I've raised unrealistic hopes for anyone. Thanks to Grumpy for providing additional arguments for the 'take it all now' option.
From IBM Pensions:
Deborah
I refer to your e-mail to Mike O'Sullivan which he has forwarded on to me.
Your request to receive your Equitable AVC benefits in advance of your main plan benefits is noted but as per our phone call I advised you that the Trustee had discussed this matter and agreed that they will not offer this facility.
The reasons for this are that when the regulations were introduced in 1999 the ability to receive AVCs early were laid down in the form that schemes who agreed to provide the option had to provide the benefit by way of 'income drawdown' i.e. not an immediate annuity. This type of arrangement is extremely complex and costly to administer. The Trustee also at that time declined to implement other 'easements' for the same reason e.g deferment of AVCs.
However, last year the Trustee did review the ability of members to defer taking their AVCs once their main plan benefits were due to be taken. This was in light of the ELAS compromise offer, and allowed currently retiring members to still obtain any uplifts they were due from the compromise scheme. At the same time they reaffirmed their decision not to allow early payment of AVCs by way of 'income drawdown' for the same reasons as in 1999.
Therefore, I am sorry but I cannot agree that you can receive your AVC benefits in advance of your main plan.
Adrian Furnell, Pensions Specialist