Can I buy an annuity with cash savings

vjkld

I don’t have a private pension only a Civil Service pension. Can i buy an annuity with just cash savings from an ordinary bank account? I am unable to find the answer to this.

Dazed_and_C0nfused

vjkld said:

I don’t have a private pension only a Civil Service pension. Can i buy an annuity with just cash savings from an ordinary bank account? I am unable to find the answer to this.

Yes.

https://www.canadalife.co.uk/retirement/purchased-life-annuity/

But why do you think that's a better option than funding a private/personal pension with some of your cash savings?

Linton

You can buy an annuity from money outside a pension but the options may be more limited and the annuity rate worse than it would be from a pension annuity.  Talk to an IFA to find out what would be the best choice in your specific circumstances. Annuities bought with saved money can be referred to as "Purchased Life Annuities".

dunstonh

Can i buy an annuity with just cash savings from an ordinary bank account? 

Yes you can.

However, it is a very niche option and commercial terms are not normally enough to make it viable for most people.

SMcGill

They are taxed less than pension annuities though, aren’t they? So for someone with high cash holdings and a desire for income certainty I would’ve expected them to be worth looking at.

dunstonh

They are taxed less than pension annuities though, aren’t they?

They are.  However, they have a much smaller cross-subsidy pool (so less mortality gain) and the volumes sold are tiny which means they don't get the same commercial terms that lifetime annuities get.

So for someone with high cash holdings and a desire for income certainty I would’ve expected them to be worth looking at.

They are an option to consider, but they are an option that nearly always gets eliminated as not being viable.      

DE_612183

should the OP consider a hybrid option - pump some money into a stakeholder pension and get tax relief, some into ISA?