AVCs to buy annuity?

cyclonebri1

Hi, back again with yet another annuity query.

I am in the process of purchasing an annuity with my private pension + serps opt out funds. This is L&G and is in process at the moment.

I have also today pressed the start button to take my company pension at 55 instead of 65 with no penalty, due to ill health. This is discretionary but the trustee I know forsees no issues.

However the group AVC pot I have I was not going to touch, but the overall company rule is that this has to be taken at the same time as the main pension.

There may be favourable rates available, no one seems sure yet, but many years ago I had written into my contract that I could take the AVC pot and buy an annuity anywhere. I know this is the norm for any private plan, but the company scheme didn't allow for this. The money cannot buy "years".

Anyway the pot is only about £33k and running it through the H-L calculator my best options appear to be with L&G.

Question is is it wise to have another annuity with L&G? is there any financial advantage?

Or would it be smarter/safer to have this totally separated by going to a different provider ??

Any help gratefully accepted, and thnks in advance.:beer:

dunstonh

Anyway the pot is only about £33k and running it through the H-L calculator my best options appear to be with L&G.

L&G used to come up often but I have found them coming out 3rd place consistently on good health annuities. If you are retiring due to ill health then you should look at enhanced annuities.

Question is is it wise to have another annuity with L&G? is there any financial advantage?

If it pays the most then fine. If it doesnt then no.

Or would it be smarter/safer to have this totally separated by going to a different provider ??

If open market option gives you the most money you go with that.

There is no financial advantage in using HL over a local IFA. Indeed, if you do quality for enhanced annuities then you may find a local IFA is far more beneficial to you as most of the enhanced annuity providers dont subscribe to the quote portals and you need to get the figures manually. The one that usually comes out top will only quote to IFAs and not the public direct.

In a situation like yours, using an IFA is a no brainer as it wont cost you any more than DIY and you could end up with more money. Plus you get someone doing the paperwork for you and you get FOS protection.

EdInvestor

There is no financial advantage in using HL over a local IFA. Indeed, if you do quality for enhanced annuities then you may find a local IFA is far more beneficial to you as most of the enhanced annuity providers dont subscribe to the quote portals and you need to get the figures manually. The one that usually comes out top will only quote to IFAs and not the public direct.

The HL annuity service is not execution-only, it's an IFA service.

cyclonebri1

L&G used to come up often but I have found them coming out 3rd place consistently on good health annuities. If you are retiring due to ill health then you should look at enhanced annuities.

I did try an impaired life option for the pension I am about to take with L&G but as my ailments are physical rather than medical there seemed no advantage, so I stuck with L&G.

dunstonh

Generally the rule of thumb (if you are not a smoker) is that you need two ongoing prescriptions.

The HL annuity service is not execution-only, it's an IFA service.

Is that using their normal IFA advice service then because that is quite expensive?

cyclonebri1

dunstonh wrote: »

Generally the rule of thumb (if you are not a smoker) is that you need two ongoing prescriptions.


Rule of thumb??


Is that using their normal IFA advice service then because that is quite expensive?

In a light hearted vein let me run you through my 2007.

Prior to this I had 2 permanent prescriptions for asthma and 1 for a defective thyroid. Still able to work Then 2007 came along.

Feb; cartiledge op to 2nd knee, now cant kneel for any length of time.

June; back opp to fuse 3 vertibrae due to wear & tear (degeneration)
Came out of hospital with damaged nerves to right leg and severe walking difficulties.

Late July; Got on pushbike in a frustrated attempt to aid my recuperation.

Early Aug; Fell off pushbike in RTA, rushed to hospital. Injuries were mainly, (but there were quite a few others, some embarassing) as follows,

Fracture to skull in 2 places, fractured neck, and a fracture to the spine but at a different level to the operation, 32 stiches in various parts of the head, concussion, lost teeth and every corner of me grazed and bruised.

Mid Aug; 11 days imobile in hospital due to above.

Late Aug; back in for 1 day due to bone infection at hip due to the above.

Late Aug; back in for 1 day and on warfarin for 6 months due to DVT caused by the above

Also lost sence of smell and taste but that is gradually coming back, but still almost blackout if I get up/ spin round quickly.

Dec; original back opp is now deemed "unsuccessful" and further scans X rays planned.

Last few months have been spent trying to recover from what happened, I will be on anti depresents for a good while yet, but boy does it feel good to be alive.

The great thing is that my employers have been supportive and it does appear that at 55 I have done enough to be "comfortable"


I am looking forward to 2008 (undertatement):j :j :j


Sorry for the ramble but things need putting in perspective sometimes,


PS, do you think I have done enough top qualify for an impaired life annuity:rotfl: :rotfl: :rotfl: :rotfl: :rotfl: :rotfl: :rotfl: :rotfl: :rotfl: :rotfl: :rotfl:


'cos If I haven't, well I give up,

EdInvestor

Blimey.The mind boggles.And this was all caused by falling off a pushbike?

cyclonebri1

EdInvestor wrote: »

Blimey.The mind boggles.And this was all caused by falling off a pushbike?

25mph down hill, over the handle bars, no crash hat lesson learnt. Oh, don't sleep much now either, see post time.

dunstonh

You would find it hard pushed for 2008 to be worse. Surprised you haven't got high blood pressure with all that. If you did, that it is one of the things that can get you higher annuity income.

Injury related medications tend not to be enough by themselves but they can be additional to others. You are borderline case as to whether they would accept you or not.

Have you at any point completed a medical details form and got an IFA to give that to the various enhanced rate providers to see what they say?

cyclonebri1

Have you at any point completed a medical details form and got an IFA to give that to the various enhanced rate providers to see what they say?

I have, but due to the problems I had with my IFA I dropped him and didn't pursue it.

It's sort of why I posted last years life story. With no disrespect to yourself, ( I find your, and others, advice invaluable), and the majority of your profession, obtaining the Nth degree of value from a transaction isn't always the top priority.
Peace of mind, dealing with someone you know and are familiar with all matter. Probably a little hard to understand for a proffessional who has to look at every client from the point of view of saving them money.

However it is great to be able to pick peoples brains on here, get the facts, and then make a descision based on what suits;)

Thanks again.

dunstonh

It's sort of why I posted last years life story. With no disrespect to yourself, ( I find your, and others, advice invaluable), and the majority of your profession, obtaining the Nth degree of value from a transaction isn't always the top priority.

I understand that. To give you a rough idea, the lowest difference in enhanced rate was just over 1%. (i.e. 7 to 8%).

Peace of mind, dealing with someone you know and are familiar with all matter. Probably a little hard to understand for a proffessional who has to look at every client from the point of view of saving them money.

Not really hard to understand. Often with small differences, the quickest and eaiest can make sense and I have often gone with the original even if OMO gave a slightly larger increase. I have the advantage of knowing the good and bad service providers generally so you know before you start a lot of time if an option is going to produce more.

With OMO it often takes a week or two longer to sort out then going in-house. However, this is a once in a lifetime decision. Once that annuity is bought and is outside of cancellation rights you cannot change your mind. So, measure the difference, if any, on that.