You should always consider search for better annuities rates, you have a right to use your pensions to shop around to try and find greater income in retirement. We will identify important issues relating to your personal retirement needs and work closely with you to select the right annuity not only for you but for your entire family. We will also take into consideration your personal health to see if you qualify for enhanced annuities.
What is an annuity?
An annuity is, simply put a financial product that allows you to convert your pension pot into a secure regular income for you and your family for the rest of your lives. Annuities rates are calculated as a percentage of your pension, so for example, if you have £100,000 in your pension and the insurance company offers you a rate of 5% per year, you will receive £5,000 each year.
What is an Enhanced Annuity?
An enhanced annuity is based on your medical condition and if you have certain medical problems the annuity provider will give you a greater annuity rate, meaning a higher level of income until you die. The industry says approximately 20% of all annuities currently sold in the UK are enhanced but this is only scratching the surface they expect as many 60% of all annuity applicants could qualify for an annuity enhancement. So, it is crucial that you speak to a financial adviser before making this important decision.
The main conditions annuity providers look for whether you could qualify for an enhanced annuity is as follows. • Smoking • Diabetes • High blood pressure • Heart disease • Cancer • Kidney failure • Asthma • High Cholesterol
The amount of enhancement on your annuity will depend on your personal circumstances.
What annuity options are there?
Single Life Annuity: This means the annuity will only pay income to you and will stop when you pass away. Therefore, your spouse would not receive income from the annuity.
Joint Life Annuity: This means the annuity will continue to pay an income to your spouse even after your death. There are various levels of income available for the spouse.
For example, if you were to take a 50% spouse pension and you received an annual annuity income of £6,000, on your death your spouse would receive £3,000 per annum until their death.
This means the annuity will continue to pay an income for a selected period, even if you were to pass away before the time. The typical guarantee periods on annuities are either 5 or 10 years. This ensures you will get back as much of your original pension savings as possible.
Escalation or Increasing Annuities:
These annuities are designed to keep up with inflation, so each year your annuity has been running for your income will increase depending on various indexes. Escalation on annuities will reduce your initial starting point.
· Level Annuity – This means the annuity income will remain the same.
· Retail Price Index Annuity – This means each year your annuity income will increase in line with the Retail Price Index (RPI)
· Percentage Increasing Annuity – This means each year your annuity income will increase by a fixed amount, typically between 1 – 8%.
We will search the market and help you find the best rate for you and your family if you have any medical conditions, we are experienced in dealing with annuity provides to get the best rate possible for you. By increasing your annuity rate by only a small amount you could substantially increase your income.