• ENHANCED ANNUITIES

  If you drink alcohol or smoke tobacco on a regular basis, take regular medication or have been hospitalised for any length of time, you could be eligible for an enhanced annuity. This could increase your annual retirement income by as much as 45% or more!
  Read More

• ANNUITY CALCULATOR

  Use our Annuity Calculator to see how much potential income you will get from an annuity. Enter a few basic details such as your fund size, age, annuity type to see what your annual retirement income might be. See what sized annuity you could get.
  Read More

• ANNUITY
  TIPS

  We have compiled the Top 5 Annuity Tips. Follow these simple steps and you can ensure you get the highest annuity rates possible. Discover the best way to a higher income and avoid missing out on a more enjoyable retirement.
  Read More

Use your Open Market Option

It is your right to shop around for the best annuity – so use it! A lot of people wrongly assume that they have to buy their pension annuity from the company with which they have been building up their pension with. This is not true, in fact you can buy your pension from a company of your choosing, it’s what is known as using the Open Market Option (OMO). Some recent estimates have shown than around 60% of annuitants did NOT shop around for the best deal. It is also highly unlikely that your current pension provider has the best annuity offer for you, which means you will miss out on a potentially higher retirement income if you do not compare providers.

---

Retirement and Pension Annuities

A lot of retirees think that their pension starts to pay out automatically when they retire – this is not the case. Your ‘pension’ if you have been saving into a ‘defined contributions’ scheme is really just a pot of money, it belongs to you, and you can choose to invest it with whichever pension provider you choose. You can buy an annuity, which for most retirees is the best and most secure option. If you have a larger pension fund, you might want to consider other options such as income drawdown or annuity deferment – basically delaying buying an annuity.

Annuities Explained

To put it simply, an annuity is a lump sum (pension pot) that can be converted to an income for life. You purchase an annuity from an insurer who then pays you an income for the rest of your life. You can withdraw 25% of the fund tax free when you retire, with the rest being paid monthly throughout your retirement. This income is taxable – the amount you will get depends on many factors such as your age, health, location, gender as well as the type of annuity you buy (there are dozens on the market).

Which Annuity is right for me?

The overwhelming majority of people opt for standard or ‘level’ lifetime annuities. These pay the same amount in income every year until you die. Here is a brief description of the various annuities on the market.

• Level annuity – Your income remains at the same level until you pass away.
• Escalating annuity – You can peg your annuity income to the RPI inflation rate or a specific amount (e.g 3%).
• Guaranteed annuity – You can guarantee your income will continue for a specific amount of years if after you pass away.
• Joint-life annuity – Your partner will continue to receive income after you pass away. Can be anything from half to the full amount.
• Investment-linked / Asset-back annuity – Wealthier retirees often invest in the stock market. Income can go up if the stocks do well, but down if they don’t. These come with minimum income guarantees.