annuities

Legacy_user

I have a lump sum to invest in an annuity. Does anyone know which company is offering the best deal for a 60year old non-smoking female?

Pal

You need to go through an IFA to get the best annuity. Annuity rates change regularly and who is best one week will not be the week afterwards.

How much money have you got to buy the annuity with?

Malcolm_Sharp

Although best buy annuities vary frequently, has anybody carried out any analysis which indicates which companies are conistently amongst those offering the highest amounts.
I am a 61 year old non-smoking male, with a mimimum of £45000 to invest.
I would like to find the companies offering the highest payout for my self alone, and also for myself and my 59 year old wife.
Any help will be greatly appreciated.
I could have considerably more to invest, but would appreciate help in deciding whether to put money into a high interest savings account, or use it to buy an annuity.

dunstonh

I arrange a lot of annuities and its not possible to tell which one will come out top until your details are put into the system and the providers come back with their quotes. In the last two weeks these providers below have come out top for me whilst arranging for clients:

Standard Life
GE Life
Canada Life
Legal & General
Prudential
Norwich Union

One of the reasons is that the rates do change frequently. Another reason is that different providers use different age criteria. Some have a daily rate which means that if you are 61 and 31 days, you will get less than when you are 61 and 140 days. Some work on months, some work on quarters. If a provider wants to raise some capital at that time for any particular reason, they can up their annuity rate until they get the amounts they want and then they put them down again.

In a situation like this you should go to an IFA as its a really straight foward transaction. The IFA can show you the list of providers who come out top and you can pick the one you like.

Purchasing annuities is not something you can really do yourself and even if you do, you are unlikely to get any preferential rate for dealing direct.

We have a very short questionnaire for arranging an annuity (can be completed in minutes) and I expect the same for most IFAs. Once that is complete, your details would be input a computer that is linked to most the major providers. This gives a list of what they offer. Then a call is made to that provider to issue a quote (or in most cases a visit to their IFA website to get a full printed quote which has a time guarantee on it). Then you decide what you are going to do.

It really is one of the simplest transactions that an IFA can do so i recommend your contact one.

Malcolm_Sharp

Many thanks DD. I will wait until nearer fhe time before investigating further the best provider, however another possible option, would, I think, be to transfer the fund into my Final Salary Pension Scheme, and increase my pension accordingly.
If this is possible, would this generally be a better option? (Bearing in mind that somewhere along the line an IFA has to make a living).
MalcolmS60

Milarky

One of the reasons is that the rates do change frequently. Another reason is that different providers use different age criteria. Some have a daily rate which means that if you are 61 and 31 days, you will get less than when you are 61 and 140 days. Some work on months, some work on quarters. If a provider wants to raise some capital at that time for any particular reason, they can up their annuity rate until they get the amounts they want and then they put them down again.

You make buying an annuity sound not unlike buying a house - or a new car - choices, choices, choices...

I would hope that by the time I come to retire this 'option' will be a lot simpler and transparent than it seems today. Perhaps the government could concentrate its efforts at reform of the pension system [miniscule though they may be] on producing a more certain OR competitive OR reliable 'market' in annuities [parallels to the woes of the housing market]? If the rates are yoo-yooing in reality, my response is that they shouldn't be. >:(

[mini rant over!]

dunstonh

It is very simple really.  Name, date of birth, amount, smoker/non, health status gets input and up come the top ones at that moment.  If you want an annuity at that point, its easy.  If you are trying to judge who will be the best in a few months time, then its less so.

I was just trying to give an insight as to why they change so much.  

The more choice you have, the more complicated it gets but is it better to have less complicated but less flexible terms?  

As for transferring it into your final salary scheme, that is of course a valid option but you would need to ascertain what penalties the pension provider would make and how much the final salary scheme would offer you in return for the transfer value. Guessing here but its possibly not as much as you would want. In addition, you may not get as much tax free lump sum out of it in the final salary scheme. An IFA could investigate this but it would likely be on a fee basis.

System

Hi,

Surely in this day and age there is a web site that will allow you to punch in your details and give you the latest best annuity deal. A bit like buy.co.uk does for for fuel bills. Anyone know such a site?

Geoff

caveat_emptor

Posted by: Geoff Clayton Posted on: Today at 2:41am
Hi,

Surely in this day and age there is a web site that will allow you to punch in your details and give you the latest best annuity deal. A bit like buy.co.uk does for for fuel bills. Anyone know such a site?
Geoff

Trouble is there are so many variables like age, single/married, level or escalating and so on, so quote would have to be specifically for you. You can get an idea from websites,try Google, but in the end you will need one for your own circumstances.
???
Cav

dunstonh

Plus IFAs pay for annuity comparisons. So i doubt the providers would offer them free to every one else otherwise IFAs would just use the free site.

There is a basic comparison at the FSA website but it shouldnt be relied upon.

Compulsary purchase annuities are not the only option at retirement. You have with profits annuities, unit linked annuities, drawdown, phased retirement, transfer to PPP with immediate vesting, purchase life annuities etc. All of which maybe more suitable than the bog standard compulsary purchase annuity.

And as i mentioned, you wouldnt get the annuity any cheaper going direct than getting it from an IFA. Indeed, an IFA could be cheaper.

Church_mouse_4

Hi, I've read a lot of your posts on different subjects and want to ask your advice. My mother has had to go into a residential home and as her attorney I am now having to sell her house to pay for her care. I have asked for the advice from 3 IFA's. One from Saga, one from Help the Aged and one who is local, works in partership with his wife and is not allied to any organisation.

They all mention Care Home Annuities with varying degrees of emphasis. The least keen is the last local one. The figures for an annuity vary considerably, from £ 78,000. th £ 82,000 to £ 53,000. All these quotes are based on the same information.

It is tempting to go with the one who is the cheapest and who is local, but I have a few reservations. I have asked around and heard nothing about him, neither good nor bad. I'm not very impressed by an advert he has run in the local paper offering to help people get out of CC agreements via a loophole. ( Seems wrong to me.) There's been a few small gripes ( spelling mistakes, comprehension mistakes - calling attendance allowance 'attendants allowance' and not asking to see my power of attorney forms to verify my claims ) and so on. I feel that I have to be especially careful because I am not dealing with my money here, but my mother's.
The last IFA mentions using Sterling Investment Managers to buy corporate bonds.

I am very new to all this. Can you offer any advice please? Many thanks.