There are many plans available for seniors to get a regular income for the rest of their lives. An annuity is a retirement income that one can buy with some or all of the pension income. It provides the buyer with a regular income for the rest of their life or for a certain period of time. One can purchase the annuity when someone starts their retirement, whatever age it may be. The earlier someone retires, the longer their money will have to last, which means the income will likely be lower. There are so many companies offering lifetime annuities in the UK.
Features of lifetime annuities in the UK
The annuity mainly depends on some of the below factors such as:
- The younger the person the less income they are going to receive.
- Generally, men receive a better annuity rate because they typically do not longer as compared to women.
- The lifestyle and health can affect someone’s income and the with medical conditions or unhealthy lifestyles can get some more income.
- The annuity also depends on the income to increase every year or not.
There are main 2 types of annuity such as basic lifetime annuities and investment-linked annuities. In the case of base lifetime type, the buyer sets the income in advance. In the case of investment-linked annuities, the income rises and falls with the investment performances. In the case of lifetime annuities, there will be protection against inflation. It also ensures lifetime income. There is also predictability about the income. The investment-linked annuities always guarantee a minimum income in case of a weak fund’s performance. With the investment-linked annuities,one can also opt for single or joint annuity and guarantee periods, higher rates and value protection if the buyer has a short life expectancy due to poor lifestyle or health.
If someonehas to decide about one annuity,then it’s important to shop around. According to some research,most people could buy a better annuity by shopping around rather than buying from one particular provider.If one is considering an investment-linked annuity then it is recommended to speak to a regulated financial adviser. As there are various annuity products available in the market, so one need to choose the one which can give peace of mind to the investor. One must carefully choose the plan, as there are also risks associated with these products.