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USS and the LTA - to keep investing or to back off?
Posted: March 18th, 2024, 6:34 pm
by Craghopper2022
I wonder if any members have opinions on the potential reinstatement of the LTA and its effect on USS pensions (the UK University Pension that is hybrid, i.e. part DB and part DC)? If a LTA breach under the old system is predicted at retirement age, what would be the next steps? 1) Keep piling in hard-earned funds and hope for some sort of protection or higher future limit, or 2) Cancel extra payments (AVCs) and redirect taxed funds elsewhere, or 3) Something else?
Re: USS and the LTA - to keep investing or to back off?
Posted: March 18th, 2024, 8:03 pm
by BullDog
Welcome to TLF.
That's a good question. Seeing as the likely incoming government doesn't appear to want to give us clarity on any policies, I'm not sure you can make any decisions. I would just carry on and keep an ear to the ground for any further information on this. You're aware of the issue and that's a good thing. Sorry can't be more helpful.
Re: USS and the LTA - to keep investing or to back off?
Posted: March 18th, 2024, 9:11 pm
by gpadsa
If the current marginal rate of taxation on the AVC ££ would be >40% it might be worth continuing the AVC - if the expected marginal rate on retirement would be <40%. No doubt successive govts of the day & USS will continue to mess around with pension & scheme regs every few years forever. Planning is so difficult.
gpadsa