Fixed term annuity

Pat38493

zagfles said:

Interesting some of these fixed term annuities seem better value than simply buying a gilt or a gilt ladder from a very quick rough check. I guess there's mortality credits - if you die during the fixed term is there any payout for dependants?

The  other question is whether the commission and charges are already factored in to those quotes on the estimator or if they are extra - a 1% or 2% commission on those deals will make a dent if it's a big amount.

Donewithwork1

I recently had a quote and the commission was already factored in at 1.68% but I actually had to ask the chap on the phone what if any commission they would be getting.  For me, 1.68% was almost 6K which seems an awful lot of money for them just to fill in a few forms and send off to the provider (Canada Life)

It seems to me that some of these little 'arrangements' some of these companies have with IFA's, wherby you can't deal direct but have to go through an IFA is a convenient little earner!

I have for the moment decided not to go ahead as not happy with the goalposts seemingly moving daily due to slightly falling rates (9K difference in a week) and conflicting info from the IFA.  One minute they told me a quote was held for 14 days and then not apparently, leaving me with little confidence in this process, so next time I will be better aware and informed.

Donewithwork1

Trapdoor said:

Donewithwork1 said:

Trapdoor said:

Just FYI, Canada Life have issued an annuities notice to say fixed term annuity rates have been reduced. My quote has reduced by £3k pa for a 5 year term. I’m pushing my IFA to get the forms in with the original quote which is valid for 2 weeks at the old rate but expires early next week 😳

Trapdoor, out of interest, do you know what fee you are being charged if going ahead?  The firm quoting me would charge 1.68% which for my pot is a fee of £5,859   

Do you have a link to Canada life's notice that you refer to please?

My fee structure is complicated … for various reasons … and it would not be prudent to quote it. 1.68% does seem a lot though.

I don’t have a link as this was relayed to me by my IFA but it’s easy to run a quote and compare it to one a couple of weeks ago … which is just what I did and for the same amount used to purchase the annuity, my annual amount has dropped by just over £3k 🙁

Thank you, no worries.

wjr4

Donewithwork1 said:

I recently had a quote and the commission was already factored in at 1.68% but I actually had to ask the chap on the phone what if any commission they would be getting.  For me, 1.68% was almost 6K which seems an awful lot of money for them just to fill in a few forms and send off to the provider (Canada Life)

It seems to me that some of these little 'arrangements' some of these companies have with IFA's, wherby you can't deal direct but have to go through an IFA is a convenient little earner!

I have for the moment decided not to go ahead as not happy with the goalposts seemingly moving daily due to slightly falling rates (9K difference in a week) and conflicting info from the IFA.  One minute they told me a quote was held for 14 days and then not apparently, leaving me with little confidence in this process, so next time I will be better aware and informed.

It isn’t called commission. You’ll be paying a fee. 

mark55man

Useful to bridge the gap before my DB and possibly to remove the risk actuarial reduction if I needed to take it early.

If I use some of my SIPP Pot to do this would exceed the TFLS would that trigger MPAA as I reluctant to do that.  I know some annuities don't that