How best to plan to use some of a (currently 100% equity) DC for an annuity in six years time?

BookofShadows

OldScientist said:

It sounds like your suggested approach makes good use of the limited choices you have on your DC platform. You're right that you might not guarantee the exact level of income, but holding the over 5 year index linked gilt fund should reduce the effect of changes in yields (and, eventually, income) - I cannot find the duration of the fund, but would guess from what info I have found is that it is around the 15 year mark. For future contributions, it is the contemporaneous annuity rate your are 'locking in' (so if rates rise, and fund prices fall you will lock in more income and vice versa).

Thanks, once again helpful. 

Best I can find to help with the fund duration is this: 

 Top 10 holdings
1¼% Index-linked Treasury Gilt 2032 6.7%
1 1/8% Index-linked Treasury Gilt 2037 6.0%
0¾% Index-linked Treasury Gilt 2034 5.5%
0 5/8% Index-linked Treasury Gilt 2040 5.3%
2% Index-linked Treasury Stock 2035 5.3%
0¾% Index-linked Treasury Gilt 2033 4.5%
0 1/8% Index-linked Treasury Gilt 2044 4.3%
0 1/8% Index-linked Treasury Gilt 2036 4.3%
0 5/8% Index-linked Treasury Gilt 2042 4.3%
1¼% Index-linked Treasury Gilt 2055 4.1%

QrizB

I've thrown your numbers into a quick and very dirty spreadsheet.

The top ten holdings you've listed make up 50.3% of the fund, and the weighted average duration of those ten is about 13 years.