loose change

Friday 21 July 1995 23:02 BST
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What they mean when they say ... AVCs

Most company pensions schemes enable members to top up retirement funds through additional voluntary contributions, or AVCs, used by over 1 million employees as a tax-efficient way of saving. It is also possible to set up a private, or free-standing AVC.

But a report by Watson Wyatt, the consultants, says the investment performance of AVC providers can vary enormously, as can the charges levied. It blames many pension scheme trustees for not explaining options to employees. The average performance of the most popular form of AVC, the with-profits fund, continues to fall - from 18.6 per cent in 1989 to 12.9 per cent this year.

Desperate times,

desperate measures

The increasingly fierce battle for mortgage business has prompted a stunning array of incentives. Britannia building society this week offered to pay off 10 per cent of your mortgage after five years, provided you borrow at its standard rate. Compare this with the current offer from the Mortgage Business which promises a free Renault Clio for a year (plus road tax etc) after which you can buy it at trade price.

Exploding financial myths

One of the enduring conundrums of our time is why we are always so keen to buy life assurance. It has the status of being essential for anyone with dependants or a mortgage. Yet for people in their twenties and thirties the chances of dying are virtually nil. It has to be much more likely - though still a pretty slim chance - that they will fall ill, have a debilitating accident or lose their job.

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