AVCs
You can choose to increase your benefits from the NGE Group of the ESPS by paying Additional Voluntary Contributions (AVCs). AVCs are deducted from your pay and automatically get tax relief, just like your normal pension contributions.
AVCs are used to:
- buy added years of contributing service
- pay contributions to money purchase arrangements.
You can make AVCs on a regular basis or as a one-off payment.
Limits on how much you can pay
There are limits on the amount of benefits you can build up in a defined benefit arrangement or pay into a defined contribution arrangement (including Scheme AVCs) in a tax-efficient manner.
Added years
The cost of added years AVCs depends on your age and your pensionable salary – please contact Railpen for a quotation.
Money purchase AVCs
Members can pay money purchase AVCs via Legal & General. You pay contributions into your chosen fund(s) and at retirement, the value of the fund is used to either enhance your lump sum payable from the Group to the permitted limit, or can be used to 'buy' extra pension by way of an annuity, which you can purchase from the AVC provider or from an alternative insurance company.
If you would like to pay money purchase AVCs, please contact Railpen or use the Money purchase AVC form available in the library below.
The Group’s AVC arrangement with Legal & General is subject to two charges - an annual management charge of 0.20%, and a fund management charge, which varies from fund to fund.
The annual management charge covers the cost of Legal & General administering your pension policy. It’s calculated daily and deducted once a month by selling units in your pension savings. The AMC deductions (0.2%) are shown on your annual statement received from Legal & General.
The fund management charge covers the cost to L&G of the investment management charges plus additional expenses for each fund. It includes investment management fees, fund administration fees, custody/custodian fees, auditing and accounting fees as well as regulatory charges and is reflected in the unit price of each fund. Please see the Legal & General investment guide to understand the individual rates applicable to each fund.
For members who started paying AVCs before 1 April 2010 with Aviva, the following funds are available:
Aviva Deposit Fund
Aviva Global Equity Fund
Aviva International Index Tracking Fund
Aviva Long Gilt Fund
Aviva Mixed Investments 40-85% Shares Fund
Aviva UK Equity Fund
Aviva UK Index Tracking Fund
Aviva With-Profit Fund
Aviva With-Profit Guaranteed Fund
For more information about paying money purchase AVCs or making changes to your current contributions or fund choices, please contact Railpen
Prudential investment funds include:
Global Equity
Discretionary
Long-Term Gilt Passive (formerly called 'Retirement Protection')
Cash
The following funds make up the Lifestyle investment option:
BlackRock UK Equity Index
International Equity
Index-Linked
From 1 October 2017, the following funds are only available if you were already contributing to them:
UK Equity
UK Equity Passive Fund
Deposit Fund
Dynamic Growth IV Fund*
* This fund is held as a component of the lifestyle strategy; if you are invested in this fund, you were previously invested in the ‘International Equity’ and ‘UK Equity Passive’ funds.
For more information about paying money purchase AVCs or making changes to your current contributions or fund choices, please contact Railpen
Savings with Utmost are invested in the ‘Investing by Age’ strategy which is made up of the following funds: Multi-Asset Moderate, Multi-Asset Cautious, Money Market.