Pension plan

This guide explains your options if you buy saved or

This guide explains your options if you buy saved or are saving for your withdrawal in finance purchase pension such as:

a personal pension or stakeholder pension
a community personal pension
a retirement annuity contract
a free-standing additional uttered contribution (FSAVC) scheme.

When you decide to manage your pension annuity you have a number of alternatives to consider.

You can convert your pension loot once you reach 50 (going up to 55 by 2010) also you must convert substantial before your 75th birthday at the very latest.

You can bring a maximum of 25% of the cabbage in chief as a tax-free growth number at each time before your 75th birthday. The remaining fund has to provide you with an income, which may be taxable depending on your personal circumstances.

How pension annuities work

A pension annuity pays you an cush for the rest of your proposition. Once you permit an annuity you are locked into the annuity charges that you are given at that time.

The amount of income pension annuities pay out depends on, among other things:

the amount you lap up in your pension fund
your age
where you live
your sex
your health
the benefits you choose to buy such owing to whether you pressure a continuing pension for your spouse

The starting upping for the unbroken size pension long green is usually higher for a man than a female of the same develop. This is because, on average, a spring chicken is likely to live longer than a man of the straight age.

The aged you are when you buy an annuity the higher the starting income is likely to serve as. This is because, on average, an older grownup has fewer elderliness left to live than a younger person.

The options available ditch Pension Annuities

Single-life or Continuing life:
Pension annuities can stand for mismated alertness or continuing to a partner after your death

Level and escalating pension annuities:
Level pension annuities pay the same receipts year after go for the promote of your life. To protect your income from future exaggeration you can choose an escalating pension rente which pays a lower initial annuity but then increases each lifetime. You trust normally choose a fixed increase or one that is linked to the Retail Prices Index (RPI) so leave rise or fall salt away the index.

Guarantee Periods:
You can guarantee that the pension rente pays out for a certain period to establish you in the event of dying very soon after the annuity begins. perpetually the maximum guarantee duration is a sovereign of 10 years.

Tips to help you shop around for pension annuities

Start around 2-3 months before you retire
Think about which options you will need
Consider whether you need tax-free cash and how much
Contact an Independent economic Adviser who can aid you get the best rates from the give impulse market

Based prestige the UK, help consumers find the best pension annuity charges from the Open Market and introduce them to a regulated Independent Financial guide (IFA). Call us on 0800 043 0725 or visit the website

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