Letter: Reason to be prudent 1

I was interested in H. C. S Ferguson's reference (Letters, THES , January 4) to the normal retirement age for the Teachers Superannuation Scheme as 60. The concept of "normal retirement age" is critical in the context of an additional voluntary contribution. Prudential, provider of the "in-house" AVC scheme linked with the TSS, bases all its illustrative AVC benefit calculations on assumed retirement at 60.

There is potentially a very nasty sting in the tail for someone who continues to work beyond 60 and achieves 40 years' contributions with the TSS. They may find that they have made more contributions to their Prudential AVC than are allowed under Inland Revenue rules. In these circumstances, they will not be able to retrieve their excess contributions until they eventually retire. Prudential provides a warning about this, but you will have to search for it on their website (see below) where it states: "If by retirement you will have achieved 40 years of pensionable service within the main Teachers' Pension Scheme, your scope for benefit improvement through AVCs will be very restricted." It is a pity this warning is not displayed more prominently.

Details: www.pru-teachers.co.uk/teachers/england_and_wales/member/bl_avc_4.htm

Mike Farmer
University of Gloucestershire.