Lifetime Annuities

A lifetime annuity converts your pension into an income for the rest of your life, however long you live. They particularly appeal to those who need to minimise risk and require the security of guarantees.

As with any long-term investment, there are a number of factors to consider at the outset, and the amount of income an annuity will pay depends on a number of things which include:

• The amount in your pension fund after taking any tax-free cash (which must be taken before your 75th birthday).
• Your health and lifestyle – some annuities pay you a higher-than-normal income if your health or lifestyle threatens to reduce your life span.
• Your age – the older you are the higher the income you might receive.
• Your sex – usually the starting income from the same size of pension fund is higher for a man, than it is for a woman of the same age.
• The type of other benefits and options you choose.

Choosing a lifetime annuity takes careful consideration and you will need specialist help to weigh up:

Advantages: the guaranteed lifetime income, 0, 5 or 10 year payment guarantees and for the life thereafter of the annuitant, minimal paperwork and tax-free options for a lump sum.

Disadvantages: no option to vary your income, complete loss of control of your fund, and a lifetime annuity may exclude you from taking part in other investment return schemes.

Robert Bruce Associates provide specialist, helpful and clear advice on annuities, so you can make an informed, fact-based choice. If you have any questions or if you would like to arrange a discussion call 0845 600 6080 or email info@rbaifa.co.uk.