Whitechurch Annuity Service

Retirement is one of the most significant lifestyle changes that you will ever have to go through and prior to the event there are numerous questions that need to be considered in order to best prepare you and your family for those potentially long, future years in retirement.

The most important tasks are to review all of your financial circumstances in order to ensure that you and your family are best placed financially to enjoy a comfortable retirement. However, what are the key questions you should be asking and what are the things you should be considering?

To assist you in answering these questions we have produced a Retirement Checklist and a Retirement Options Guide, both of which are available from the Free Guides section of our website.

Ultimately though, everyone who has a pension plan will eventually have to make a crucial decision. The time of the decision could be:

• at retirement to replace earnings
• at early retirement / late retirement
• before or after retirement
• part of your benefits now and part later
• at age 75

The timing of the decision to use your pension fund for income can determine how much you get. At present the usual earliest retirement age is 50, although this is due to be increased to age 55 in the year 2010.

Taking your benefits early or earlier than you need them will mean that your income from an annuity will be lower. This is because:

• Your pension fund must provide income for the rest of your life. At younger retirement ages the fund is likely to have to pay you for many years so the income will be lower but if you start your income at an older age, meaning it will be needed for fewer years, then the income will be higher. This is based on average life expectancy at your age. For this reason, as men and women have a different life expectancy, the amounts payable to each group at the same age will differ.
• The pension fund that is used to buy an income through an annuity will cease to be invested. If the start is delayed by, say, five years, the pension could benefit from:
  
  • an extra five years extra growth making a larger fund available - although investments can go down as well as up.
  • a higher annuity rate due to your older age - although it is impossible to predict future annuity rates.

What annuity is best for you?

There are several types of annuity that can be purchased at retirement, you can select from level, escalating, impaired to name but a few - it can get quite confusing!

See Types of annuity available for details of the options available and an explanation of each.

How much income will I receive?

This can only be calculated when you actually decide to annuitise and the amount you receive is based on long-term government gilt yields and your predicted life expectancy.

On average we are living longer and this is good news. However, providers have to pay out annuities for the remainder of the annuitant’s life and if life expectancy averages are increasing this will have a negative impact on your annuity rate. But it is also important to consider that you will potentially be living longer and will therefore receive an income for longer.

Shop around - the Open Market Option

Near retirement your pension provider will provide you with the annuity rate that they can offer you when you retire. However, you are not obliged to purchase your annuity through your pension provider as they may not be offering the best rate available.

You can shop around in order to try and secure the highest possible income with your pension plans, by using your open market option.

Whitechurch Securities have made this process a little easier for you by providing you with the opportunity to get some idea of the pension income available from some of the leading annuity providers. Just click the link below and follow the simple step by step process, which will take no longer than 5 minutes and you will be able to find out the income you could receive from your pension plans.

Please note that these figures are not guaranteed and may differ from the figures provided on the actual quotation from the Annuity Provider.

How we can increase your income in retirement

Whitechurch Securities could provide you with a more competitive quotation by using our Discounted Annuity Service. If you use this service we will ascertain which annuity is suitable for you and will search the market for the best rate.

We will increase your income in retirement by reinvesting a minimum of 25% of the commission we receive to increase the annuity rate.

If you are interested in this service please click here and complete the online form. This will then be submitted to us and we will start searching for the best rate straightaway and will contact you accordingly.

If you have any further questions or would like to discuss your annuity options by telephone, please contact us on freephone 0800 37 44 13 and ask for the annuity desk.

Important notes - please read

Do you need advice? - These web pages contain product specific details only and unless we have complete up to date written details of your financial circumstances and requirements we cannot and will not offer any opinion as to the suitability of any product for any client. Any response to these web pages will therefore be on the basis that client specific advice has not been given. These investments are not suitable for everyone. If you have any doubt whether they are suitable, you should obtain expert advice.

Taxation - Please remember that the annuity income will be treated as earned income and will be taxed at your highest rate of tax, as it will sit on top of your other income, including the State Pension. The Pension Commencement Lump Sum is currently tax free. Levels and bases of, and relief’s from, taxation are subject to change.