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The open market annuity option gives consumers the freedom to choose whether to buy an annuity from their existing pension provider or to shop around to find the firm offering the best rate.
Annuity rates change frequently, so we shop around for the best deal for you as you near retirement.
An annuity is an investment offered by insurance companies. It is a method of converting a lump sum, usually from a pension plan, into an income for the rest of your life. Unlike most other investments, this income lasts for the rest of your life.
We can help you if you need to buy an annuity from
- a personal pension
- a retirement annuity contract (like a personal pension but sold before July 1988)
- additional voluntary contribution (AVC) schemes
- a stakeholder pension
- a group personal pension plan arranged through your employer
- a defined contribution or money purchase scheme from your employer
At the moment, most people have to purchase an annuity with their personal pension and stakeholder pension funds. Usually you can take up to a quarter of your pension fund as a tax-free lump sum. The exact amount may depend on the type of pension that you have.
The amount of income an annuity will pay depends on the amount that you have in your pension fund; your age, sex and your health at application. In addition annuities can be arranged in different ways. We call this the shape of the annuity.
You need to decide whether to have your annuity income paid- :
- level
- increasing
- with or without widows pensions.
Purchasing an annuity from another pension provider can appear daunting and complicated. This where we can help.
We know the market intimately and can offer you the following benefits:
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We make a confidential assessment of your current financial circumstances.
- From this we help you decide about the shape of your annuity. In other words do you
- take level payments or increasing payments to help protect against inflation. If you take the increasing option your payments will be lower!
- build in a widows pension and if so how much?
- do you build in a guarantee do that you payments continue for a while if you die early?
- we assess your attitude to risk to establish if an investment based annuity or a traditional or guaranteed annuity would be suited to you.
- we make an assessment of your current health conditions and life style. If you are in poor health or have been a smoker for some years you may qualify for better rates!
- We then talk to your pension company and get full details from them of your plan and a quote for an annuity with this company.
- We prepare quotes from the top annuity companies in the UK to see if any better rates are available for you.
If we think you should stay with your present company we will tell you. However, if we can find a better deal for you and you wish to proceed we will handle all the paperwork for you.
If you would ,like to discuss your annuity options with us, please get in touch.
Tel: 01244 317788
Email: info@cityinvestments.co.uk
City Investments
S11a, Chester Enterprise Centre, Chester CH2 3NE.
NB There are detailed rules about how and when you can take your benefits and the size of your fund. (You cannot obtain access to pensions until you reach 50 or 55 after 2010.) What you receive from your pension will depend on both the performance of your fund and interest rates which will affect the rate used to buy annuities. Pension funds can go down in value
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