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Fixed Term Annuity Rates & Providers

Pays you a regular annuity income for a set period of time

When you retire, if you are unwilling to commit to an annuity for the rest of your life, you could consider a fixed term annuity which pays you a regular annuity income for a fixed period of time. You can choose the amount of annuity income you receive and specify your preferred term between one and twenty five years.

At the end of your specified period, it pays you a guaranteed lump sum of money known in advance. This is often referred to as the ‘maturity amount or value’. At maturity, you can then reassess your retirement needs and use this maturity amount to buy another fixed term annuity or invest in another retirement income product, such as a conventional annuity or enhanced annuity if your health has deteriorated, or take it all as cash.

Ask one of our Annuity Specialists for more information about fixed term annuities, and a comparison table showing the highest annuity rates available for this type of annuity from the UK’s leading annuity providers. Call us now on 0800 652 1316.

Risks

  • Income from Guaranteed Maturity Amount may be lower at end of term than that available from a conventional annuity today.
  • If you are interested in buying an annuity when the term expires, rates might be lower.
  • Inflation will reduce the value of your future annuity income.
  • Less flexible than a Drawdown plan, as your annuity rates are fixed for your selected term.
  • Withdrawing all your savings might leave you with inadequate future income.
  • You need to be sure of the tax payable on your withdrawals.
  • Taking an annuity income could result in a reduction of your annual allowance for making pension contributions.

 

Benefits

  • Regular annuity income for a fixed term enabling you to budget accurately or withdraw the whole fund during the selected term, potentially more tax efficiently.
  • Guaranteed Maturity Amount without investment risk.
  • Flexibility by allowing a change of options if your future circumstances change.
  • Potential for higher annuity rates at the end of the term if your health has deteriorated or if future annuity rates increase.
  • Option of taking tax-free cash without taking any annuity income.
  • Choice of cost effective lump sum death benefits.
  • LV only: option to transfer out at any time for any reason. For example, if you were to suffer from ill health and then qualify for an enhanced annuity.

What's next?

Retirement Options

Annuity calculator

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