Help! Annuity options advice required

doublekite

My mother in law is 60 on 1.5.06.

She has a retirement fund of £6710, made up of lump sum of £1677 and net pension fund of £5033 (all figures rounded down).

Can anyone please recommend a good company or advisor to consult for the best rates?

It seems that given the low amounts, an escalating pension is not worth considering, and nor is a guarantee period. The fund is low, but every little helps as a pensioner.

One illustration she has had from her existing company (Britannic) is take the lump sum, plus annual pension of £236.35 (no guarantee period, level payment, and 50% dependents pension). Is this good?

dunstonh

Any IFA in the UK can handle the transaction. Its one of the simplest we deal in.

However, if it is the only pension she has, she is eligible to take the amount as a lump sum at that point. That is probably the most cost efficient option.

EdInvestor

As of A day if her total non state pensions are 15k or less she can take them in cash.

Otherwise, here are some current annuity rates

There is also a calculator and table of the best buys on the FSA site:

https://www.fsa.gov.uk/tables


Norwich Union is often the best for women's annuities, and it seems they might pay her 264 p.a., though more info is needed to be sure.

Pal

EdInvestor wrote:

Norwich Union is often the best for women's annuities, and it seems they might pay her 264 p.a., though more info is needed to be sure.

You a qualified, experienced, financial adviser suddenly Ed?

EdInvestor

You a qualified, experienced, financial adviser suddenly Ed?

Nah, I just ran the details through the FSA tables, they're very easy, even a woman can do it .

dunstonh

The FSA tables are totally unreliable for annuity rates. Even the annuity quotes we get from the quote portals are usually wrong. The rates change on a daily basis with most providers and the FSA tables do not reflect that.

A quick check and NU have come out top rate on annuities once in the last 2 years for me (on open market option).

EdInvestor

dunstonh wrote:

The FSA tables are totally unreliable for annuity rates.

Last time you checked I seem to remember they were spot on

dunstonh

Last time I checked, I seem to recall I only compared them to the quote portals. I have never seen a real quote match the quote portal figure. Seeing as quote portals for annuities are just as unreliable, that really doesnt surprise me.

For example, go to quote portal, 15 or so companies listed. You look at the top three and then get quotes on those top 3 direct from the companies. The companies will supply different figures and it could alter the company you end up recommending.

doublekite

Seems like Ive started a bit of a domestic here! I assume you two know each other?

To me it all seems dependent on whether she thinks she will live more than 15 years further. If so, the pension option is best, if not, take and invest the lump sum and take an annual payment ( ISA ideal here?)