Annuity Hound

Both lifetime and temporary annuities can be used as part of phased retirement in the UK, although the term any temporary annuities used as part of a phased retirement strategy may be no more than 5 years under UK pension regulations.Lifetime annuities guarantee to provide a regular income stream for the whole of the remaining life of the income recipient, in exchange for a lump sum payment.

Lifetime annuities deliver peace of mind to those in retirement who might otherwise run out of income and capital drawn from a traditional investment portfolio.

Conversely for those who do not live long in retirement annuities can represent extremely poor value.

It is possible to purchase annuities which provide financial protection against an untimely death. There are currently two mutually exclusive options for protecting UK lifetime annuities, details of which can be found at:

Capital protected annuity

Guaranteed annuity

Anyone already in poor health at the time of retirement has the option of preferential annuity rates of return. This is because ‘normal’ annuity rates are statistically based on those in good health with a relatively long life expectancy. Details of these types of annuity can be found in our sections on:

Enhanced annuity

Impaired annuity