Annuity

You can normally choose when to start taking your retirement income from your pension at anytime from age 55.

Retirement income

After you’ve taken your tax-free cash entitlement from your pension fund (normally up to 25% of the value of the fund), the remainder of your fund can then be used to buy an annuity which pays you a secure retirement income for the rest of your life.

Annuities are provided by insurance companies. The company you choose promises to pay you a guaranteed regular income in exchange for your pension fund, no matter how long you live.

Once you’ve set your annuity up, the basis of your annuity is fixed for life and offers you a secure retirement income. Your income will never run out. However, because the income you receive is fixed it is important to choose your options carefully. Once your annuity is set up you cannot change your mind – it can’t be altered.

Annuity rates

There are two very important points to consider when buying an annuity:

1. You rarely have to stay with your current pension provider when you retire and often they will not offer you the best annuity rates.

2. Different insurance companies offer different annuity rates. The difference between the best and worst retirement incomes available can be significant.

You may think that buying an annuity from a well known insurance company is the right thing to do, but their reputation doesn’t pay your bills. If we can get you more retirement income, possibly from a company you might not know, it could well be right for you, and could result in you getting thousands of pounds more retirement income.

Annuity quotes

The annuity quotes you’ll be offered depend on various factors: the amount left in your pension fund after you’ve taken your tax-free cash entitlement; your health or lifestyle; your age; your gender; and whether you buy a single life or a joint life annuity.

In addition, the options you choose for your annuity can also effect the annuity quotes you’ll receive.