There are so many things you need to take into consideration before making an annuity purchase: the complicated jargon that comes with the contract, the factors that affect how much payment you would get, and maybe other arrangements that you need to sort out. Though how complicated and difficult choosing an annuity contract, all you need is a bit of patience and a lot of research and critical thinking to decide which contract to get.

The first thing you could do is to do a background check on the company that you are interested in taking a contract with, and see from their past dealings with their clients if their services are indeed trustworthy enough for your need. Browse among their contract and find one with the best annuity rates that would suit your situation. And while negotiating with the issuing agent with the contract, make sure to ask the right questions and clear some of the parts of the contract so you would better understand it.

Choosing an annuity contract maybe difficult, but it is in no way impossible. Just make your effort to choose the best annuity for you so you could enjoy your retirement years.

With an annuity contract, you would be able to have a regular source of income on a weekly, monthly, bimonthly, or quarterly basis according to how regular you want to receive them. Its rates are determined by your age, gender, and lifestyle. And you would be allowed to have some kind of arrangement to sort out, such as letting your family members receive the rest of the pension annuities amount when you are gone. And this service guarantees that you would be paid for as long as you are still alive and well.

But choosing annuities could get difficult, with its complicated language and conditions that you need the help of a consultant and of a pension annuities calculator to help you understand. And keep in mind that once you choose an annuity contract to sign up for, you would not be able to change it so you need to choose wisely.

Just make sure you make an informed decision by doing a thorough search and research before making an annuity purchase. If you do, you would be able to enjoy your retirement years to do what you want to do without making additional expenses.

Annuity is a long term retirement option. It is also termed as an agreement between you and the insurance company. You are required to pay regularly into the retirement funds which can be reimbursed after your retirement. The amount you pay into your retirement funds are tax exempted till the maturity.

Pension annuities can be paid either in a lump sum or in installments over a period of time.

Annuities add more worth to your exeisting retiirement plans and can extend further benefits such as

• Get death cover for self and other beneficieries
• Expand your investments
• Prevents your assets from getting outlived
• Saves your taxes on a long term
• Avail regular income even after retirement till death.

When you purchase an Annuity you are bound to give up your pension funds forever by bartering it for a standard income. You can avoid this by adopting a third way annuity plan which lets you get regular income until the age of 75 and allows you to purchase another annuity. However before buying any such product take the help of an IFA.

The amount of tax free cash that can be taken from a pension fund before an annuity has to be purchased is 25% of the fund value. This money can come in very handy to pay off a mortgage, or provide university fees for your children.

It is usually a good idea to speak with a pension annuity specialist to get independent financial advice. They will search the open market to find you the best annuity rates. Your existing pension provider does not necessarily provide the best rates and you can shop around to get better annuity quotes.

If you do not have your own adviser you can call annuity specialist Retirement Solutions on 0800 043 6701

We were asked to provide quotations for an annuity bought under the Open Market Option. We quickly identified that Mr Rogers had medical conditions that might enable him to qualify for  Enhanced  Annuities (he had diabetes and bronchitis).

We initially obtained a standard rate illustration but after establishing further facts concerning his medical background, we were able to secure an uplift to his pension of 22% above the standard rates, by negotiating with several specialist annuity rate providers.

Based on standard rates, Mr Rogers pension fund (£30,800) would purchase an annual income of £2,323. Based on enhanced rates for impaired health, Mr Rogers fund eventually secured an income of £2,830, which equates to an additional £507 per annum.

Examples of some of the conditions that may qualify

• cancer
• heart conditions
• diabetes
• asthma
• obesity
• high blood pressure
• organ transplants
• stroke
• liver disease
• alzheimer’s
• chronic lung disease
• kidney disease
• multiple sclerosis
• Parkinson’s Disease
• or a disease of the central nervous system.

For advice on annuities call 0800 043 0725

How Value Protection Works

A lump sum may become payable from your annuity in the event that you die before reaching age 75.

The maximum lump sum payable under Value Protection is the initial annuity purchase price, less the sum of the income paid from the annuity.  Any Value Protection lump sum payable will be taxed at source at a rate of 35%.

Please note that the Value Protection option must be selected when you purchase your annuity it cannot be added later.

A dependant’s annuity may also be paid.  In this case, any Value Protection lump sum will be paid on the 2nd death, and will take into account the total amount of income paid to both the annuitant and the dependant.

The Value Protection options

Full Value Protection

Full Value Protection gives you the opportunity of providing a lump sum for your beneficiaries, if you die before reaching age 75, equal to the initial annuity purchase price, less the total amount of income paid.  If you die after reaching age 75, no lump sum will be payable.

Partial Value Protection

Partial Value Protection operates in a similar manner to full Value Protection.

However, instead of protecting the full value of the initial annuity purchase price, you may select to protect a proportion of it. In this case, the lump sum payable will be the proportion of the initial annuity purchase price protected, less the total amount of income paid.

Other options available:

Lump sum/Income Guarantee

This option operates in a similar manner to Value Protection.  However, if you die before age 75, but still within the selected guarantee period, the remaining payments due under the guarantee will be payable as a lump sum. If you die after age 75, no lump sum will become payable, but income will continue until the end of the guarantee period.  Please note that if you choose this option, you cannot have Value Protection as well.

Dependant’s annuity

Choosing a dependant’s annuity ensures that an income will continue to be paid to your dependant (s), should you die before them.

If a dependant’s annuity has been selected with Value Protection, a lump sum will only become payable on the 2nd death, and will take into account the aggregate income paid to both you and your dependant. The lump sum only becomes payable if you die before reaching age 75, although the age at which the dependant dies does not affect the eligibility for a lump sum payment.

Who would benefit from Value Protection?

This annuity option may benefit you if:

• You are concerned about losing out of your pension fund in the event of early death, particularly if you are in ill health
• You are more interested in lump sum death benefits than an income
• You want a guaranteed income stream and the reassurance of a lump sum death benefit if you die before age 75
• 35% tax on lump sum death benefits may represent an income tax or inheritance tax saving for your family

Get a quote

http://www.annuitysupermarket.com

For most people, a pension annuity will be purchased between the ages 50 and 75. However the minimum retirement age will rise from 50 to 55 in 2010 and a few people in special circumstances may be able to avoid annuity purchase at age 75, but most people will purchase an Annuity aged between 50 and 75.

Age

The amount your pension fund (Annuity Rates) will buy depends on your age, gender and state of health as these three factors affect how long you are expected to live. The older you are when you buy an annuity, the higher the amount you are likely to be quoted because the annuity provider (an insurance company) is unlikely to have to pay you for as many years as someone who starts taking their annuity income at a younger age.

State of health

Similarly, if you are suffering from a medical condition or illness which is likely to reduce your life expectancy, your annuity provider will pay you more because you are likely to survive fewer years than someone in good health of the same age. The same applies if you are a smoker or obese.

Gender

Women tend to live longer than men, so a woman is paid less than a man of the same age and with the same size pension fund.

Spouses’ and partners’ pensions

If you want your spouse or partner to have an income after you die, you will want to buy a ‘joint life’ annuity. This will reduce the amount you receive (compared to if you bought a ‘single life’ annuity), but will guarantee your partner or spouse an income for life after your death. Enter their age in the ‘partner’s age’ box.

You can choose what percentage of your annuity income you want your partner to receive typically, 100%, 66% or 50%. The higher the amount you choose for your partner, the lower your initial income will be.

Pension Release gives you Tax-Free Cash

If you are aged 50 plus and considering pension release, the minimum age increases from 50 to 55 in 2010, so now is the time to contact us

What is pension release?

Pension Release or ‘unlocking’ is the term used for taking the benefits from your pension before you retire and getting up to the maximum tax free cash and/or income.

How much can I release?

The current rules say that you can release a cash lump sum of up to 25% of the value of your pension fund. This is tax free and is know as a ‘Pension Commencement Lump Sum’ (PCLS). In addition, the remaining fund can be used to provide you with an income that might be taxable – depending on your circumstances.

Take action now as the age changes to 55 from April 2010

Go here for a feee 28 page report http://www.annuitysupermarket.com/pension-release.html