guaranteed annuity

tigerman

Have guaranteed annuity with Scottish Life thinking of transfering into sipps ,what is best way to go on this, stick or twist

EdInvestor

What rate does the guarantee offer?

What age does it kick in (and what age are you now, when do you want to retire?)

Are there any issues related to spouse/dependants benefits which the GAR does or doesn't offer?

Do you plan to use income drawdown later in your SIPP?

Do you have other basic guaranteed pensions adequate to provide for your needs ( eg state pensions)?

How much do you expect the fund will grow in the Sipp, compared with in the ScotLife pension? Will it grow enough to compensate for losing the guarantee in the time available?

These are the sorts of questions you need to ask.

dunstonh

In addition to Eds response....

Guaranteed annuity rates (GARs) are very valuable most of the time. Although the rate of guarantee is the important bit.

A pension with an 11% GAR is very value whereas a 5% GAR is less so. Open Market rates would be 6.5% (average - posted only to give you an idea).

Scot Life also have a relatively good range of investment funds. Including a few external funds. If these are available to you, you may find the "funds" side of a SIPP isnt required.

It may be fashionable to go with a SIPP but its not always the best option.