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Old 31st Oct 2003, 16:26
  #13 (permalink)  
BEagle
 
Join Date: May 1999
Location: Quite near 'An aerodrome somewhere in England'
Posts: 26,817
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£45K at 3% per annum gross interest equals about £810 after tax if you pay 40% to Uncle Gordon........ Even the extra £3k pension is worth £1800 after tax. Plus it becomes index-linked at 55 whereas the £45K justs sits there gaining not much income. Hence the advice being if you have an urgent need for the extra available from life commutation, fair enough - go for it. Personally I don't, so the higher pension rate is more attractive.

It would, of course, be an entirely different matter if risk-free 10% savings rates were still available!
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