There are many types of annuities and retirement options to consider as you approach retirement, and these are a few: single-level annuity, inflation-linked annuity, joint-life or last-survivor annuity, short-term annuity, income drawdown, variable annuity, guaranteed annuity, escalating annuity, and investment-linked annuity.
Not to mention: with-profits annuity, value-protected annuity, flexible annuity, conventional annuity, and phased drawdown.
And then we have the enhanced annuity and the impaired life annuity for those people with medical conditions, serious or mild, and for those who smoke.
Annuity income can normally be taken any time from age 50, but this is changing to age 55 from 2010. While benefits can be drawn from your pension fund early, doing this will reduce the level of income you receive eventually from your pension fund. Check out annuity rates to see the effects.
Your annuity is paid for your lifetime in retirement. However, if you die shortly after the annuity payments start, it does represent poor value for money, as the fund will have been used to purchase the annuity and cannot be paid as a death benefit. However, the annuity contract can be set up with options to provide for your spouse / partner and dependants should you die prematurely.
There are a wide range of retirement options designed to suit most people’s circumstances. Because of the number of choices available it is recommended that you seek financial advice before committing to any course of action. Some types of annuity and income drawdown contracts do carry investment risks and warrant careful consideration.
