Help with annuities please

MoneysavingRookie

Dumb questions here, but can I please ask if I was to purchase a Joint annuity would I still have add ons, ie Guaranteed period cover or Value protection?


I have a set amount and would like my partner to receive at least 50% of my annuity if I passed away.


Any assistance much appreciated.

zagfles

You can get joint annuities with guarantee period, but what do you mean by "value protection"?

dunstonh

f I was to purchase a Joint annuity would I still have add ons, ie Guaranteed period cover or Value protection?

You get to choose the options. Value protect or guaranteed periods are available on sole or joint.

Dox

Don't forget that the 'add ons' all reduce the starting level of your own pension.

OldMusicGuy

Use this website to get an idea of the different types of annuity available and what you might get: https://www.moneyadviceservice.org.uk/en/tools/annuities

jamesd

Your age and that of your partner are very important. So is the amount you want to spend.

If you are close to state pension age, deferring your state pension pays about twice as much as the best available inflation linked annuity unless your life expectancy is lower than usual. What this means is that you could use the money to allow you both to defer. Then you get twice as much income while both alive and your partner gets 100%, not just 50%, of the income the annuity would provide after your death.

You can also have your partner defer longer so they get more than 100% of what the annuity would pay, by deferring less yourself.

You can start to defer once even if you've already claimed your state pension.

MoneysavingRookie

Thanks for all of the responses.
Just to try and clarify my position, I have just turned the age of 55 and I want to buy a joint annuity and take the tax free cash as I have a few debts I want to clear. I also want to cover my wife so that she would get my pension payments going forward. The issue I have is the understanding of the requirements for a Guaranteed period or Value protection as I thought I could just purchase a joint annuity and I and my wife would be covered for life.


Any advice greatly appreciated..

OldMusicGuy

If you use the website link I posted above, it will walk you through all the different types of annuity available and what options you have. It has videos that explain the various options (like guarantee periods, options for increasing the value, how much your wife gets if you die etc etc). Just work through some examples using that website and it will explain it better than any of us could.

What I will say (and most people on here would say) is that buying a joint annuity with escalation at age 55 is IMO really poor value for money, given how low annuity rates are right now. Obviously it's your choice, and that website I linked to is really good at allowing you to compare different choices and options.

MoneysavingRookie

Sorry for babbling on, but would I be safe to buy a joint annuity without either the protection of a guaranteed period or value protection?

Malthusian

MoneysavingRookie wrote: »

Sorry for babbling on, but would I be safe to buy a joint annuity without either the protection of a guaranteed period or value protection?

It's only not safe if you are very concerned about the risk that both you and your spouse die relatively early, and want your heirs to receive a minimum payment if that happens. But if you were particularly concerned about the amount your heirs will get, you probably wouldn't be buying an annuity in the first place.

Income from an annuity would typically be spent, so your heirs on second death won't be expecting to get anything from the annuity regardless of when death occurs. If you are expecting the income from the annuity to accumulate in your estate and eventually be inherited on the second death, it makes little sense to buy an annuity.

xylophone

Had you considered an appointment with Pensionwise for a discussion of your options?

https://www.pensionwise.gov.uk/en