Do we go for Joint Life????

Retired_I.F.A.

Ah theres GAR's involved, As James has said they make a big difference.

Impaired life annuities dont though, your still only getting an underlying rate of 4.7%. or thereabouts.

stagey_2

Well - via the unbiased web site I sent an email to a local IFA about 24 hrs ago now - guess what - no response! OK so I'll ring when I have a chance later - but you see what I mean about my experiences as noted before with IFA's. I'm sure I've just been unlucky - I'll let you know!

bigbloke45

I think you ought to give unbiased a bit longer than a day to get an email response. Most IFA's will get back to you efficiently but, of course it will depend when they actually get the email via a third party.

Far better to 'phone them and arrange a meeting.

dunstonh

then to find that commission IFA who might share it with us!

and

I would approach a discount annuity broker. They refund a proportion of the commission that the annuity/insurance company pays the broker.

It is against HMRC rules to rebate commission on pension contracts.

You can reduce the commission taken to improve terms but you cannot pay a rebate. The enhancement is not usually that good although most IFAs will be willing to discount somewhat on larger funds. The reason the discount isnt great is that it is typically costed over the period of life expectancy. So, a £150 discount on normal health at 65 may increase the annuity by £7 a year.

stagey_2

Dear All - the email didn't get thro' via unbiased it seems - anyway am seeing IFA on Monday - having had chat on phone so he has the bare basics. Will be back! L

bigbloke45

Well done.

Good luck.

JeremyZerg

Everyone of them who recommends an annuity over drawdown needs a new brain for Xmas...

With a fund value of £71,000, mortgage commitments outstanding and possible redundancy on the horizon, I'd suggest that someone in the OP's position simply cannot afford to take the risks that are required in order to make drawdown an attractive option (i.e. significant growth in the fund).

Add to that the costs of running a plan in drawdown - administration charges, AMCs on funds, adviser commission (initial and ongoing) - in my opinion, someone in the OP's position would be far better off choosing an annuity.

(I always thought that the minimum fund value after taking tax-free cash, to make drawdown a cost-effective option, was in the region of £200,000...)

Again, just my two cents. :-)

EdInvestor

JeremyZerg wrote: »

Add to that the costs of running a plan in drawdown - administration charges, AMCs on funds, adviser commission (initial and ongoing)...

None of these charges are compulsory,of course.

JeremyZerg

None of these charges are compulsory, of course.

Well, true. (Sort of...)

But I suppose that depends on one's circumstances, doesn't it?

I think it is possible to minimise the effect that fund AMCs have on one's overall "pot", in choosing low-cost funds (or simply avoiding the pricier ones), and again, in using discount brokers - but this isn't easy.

Hence the IFA's involvement.

And unless an investor is fully confident in self-selecting an investment portfolio, paying for the services of an IFA is surely a logical option. Both parties benefit - but to a far lesser extent when the overall fund size is small.

In quite mercenary terms: the smaller the size of the fund, the less of the IFA's time is bought.

But, of course, you're quite right.

Retired_I.F.A.

Everyone can afford the risk of drawdown as it is no riskier than an annuity. One's mortgage being redeemed or not from the TFC has no bearing on the choice nor does redundancy. The "significant growth" required is currently a net 4.7% as 4.7% p/a gross is the growth in an annuity / the current yield on long dated gilts that all annuitiy quotes are calculated on to which admin charges and the providers pofit margin are then deducted.
Be it 200,000 or 5000 in a pension pot drawdown makes so much sense when you compare and understand the mechanics behind both it's a no brainer.