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Pension advice

Pension Annuity Advice: Find the Right Financial Adviser for Your Retirement Income

An annuity converts some or all of a defined contribution pension into a guaranteed taxable income, either for the rest of your life or for a fixed period. It provides certainty over how much contracted income you will receive and how often, although a level income may buy less over time as prices rise.

Before buying an annuity, there is a lot to weigh up, including which provider to choose, which features to include and how much of your pension to convert. Financiable® is a free service that connects you with an adviser from an FCA-authorised firm who can help you work through your options.

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How to get pension annuity advice

  1. Tell us what you’re looking for

    Submit a short enquiry and provide a few details about your situation.

  2. Talk to our team

    One of our specialists will call to discuss what you would like your retirement income to achieve, the pensions you are working with and where you are based.

  3. Get matched with an adviser

    We will put you in touch with an adviser from our panel whose experience is relevant to the information you’ve provided.

  4. Attend your free initial consultation

    Discuss your options with your adviser, including whether an annuity may be suitable for you. They will explain their charges before anything is agreed, and there is no obligation to proceed.

When should you seek pension annuity advice?

Annuity rates can change from day to day, and most annuities cannot be cancelled once the cooling-off period has ended. These are some of the situations in which regulated annuity pension advice may be particularly valuable.

  • Your existing pension might offer a guaranteed rate

    Some older pension arrangements may include guaranteed annuity rates that may provide a higher income than rates currently available on the open market. An adviser can help you check whether any valuable guarantees or benefits apply before you make a decision.

  • You have a health condition or you smoke

    Providers ask medical questions when calculating the income they are prepared to offer. For example, you might qualify for a higher income, known as an enhanced or impaired-life annuity, if you:

    • Have a condition such as diabetes, high blood pressure or cancer
    • Smoke
    • Have previously worked in certain occupations such as manual labour
    • Live in an area associated with lower life expectancy.

  • You’re choosing between level and increasing income

    A level annuity usually gives you a higher income at the start, while an increasing annuity is designed to help protect your spending power over time. For example, after ten years, a £200 monthly annuity increasing by a fixed 3% each year would be paying approximately £261 a month.

  • You have a partner or dependants

    An annuity usually stops paying when you die unless you take out a joint-life annuity or add optional protections, such as value protection, a guarantee period of up to 30 years or a ‘with proportion’ feature. Adding protection will generally reduce the starting income you receive. A joint-life annuity will not continue paying if the named dependant dies before you.

  • You’re deciding how much of your pension to convert

    You don’t have to use it all. You may be able to take up to 25% as tax-free cash first, buy an annuity with some of the rest, and leave the remainder invested. If you have several pensions, you may be able to take a different approach with each one. An adviser can discuss the different options with you.

  • Tax or benefits are a factor

    Annuity income counts towards your Income Tax, and a higher income might affect means-tested benefits you’re entitled to claim. An adviser can explain whether this would affect your circumstances.

Why choose Financiable®?

Buying an annuity is a significant decision. Speaking with a qualified professional can help you understand the available options before you commit. Financiable® offers:

  • Advisers from FCA-authorised firms

    Every adviser we introduce works for an FCA-authorised firm with the relevant permissions to provide retirement-income advice.

  • An introduction to an adviser

    Our team speaks to you first, then puts you in touch with an adviser suited to your situation rather than leaving you to choose from a list.

  • Coverage across the UK

    We can connect you to advisers offering pension annuity advice across the UK with options to meet in-person, on the phone or on video call.

  • Free initial consultation

    There is no charge for using Financiable® or for the initial consultation. If you choose to proceed with regulated advice, the adviser will explain any fees before you agree to anything.

To find out more about Financiable® and how we can help you, get in touch with our team.

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Our pension advice services

An annuity is one of several ways to take a retirement income. We connect you with advisers offering pension advice services including:

  • Pension Drawdown

    An alternative to buying an annuity. Drawdown keeps your pension invested and allows you to vary how much income you take, but the income is not guaranteed and the value of your pension can fall.

  • Combining Pensions

    Combining pensions can make retirement savings easier to manage, but it is not suitable for everyone. An adviser can assess whether consolidation is appropriate for your circumstances.

  • Personal Pensions

    A pension you arrange and contribute to yourself. This may be relevant if you are self-employed, do not have access to a workplace pension or want to make additional retirement contributions.

Trusted and regulated advice

  • Authorised and regulated

    Financiable® is a trading style of TFAS Wealth Limited, which is authorised and regulated by the Financial Conduct Authority – reference number: 968148.

  • Registered company

    TFAS Wealth Limited is a company registered in England and Wales – company number: 13664696.

  • Registered office

    Second Floor, St Andrew’s House, 119-121 The Headrow, Leeds LS1 5JW.

  • Data protection

    Registered with the Information Commissioner’s Office under registration number ZB370703.

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Overhead view of a financial adviser shaking hands with an older couple in their living room

Most annuities can usually be cancelled during the 30-day cooling-off period, after which they cannot so you’ll want to be sure you’re receiving regulated advice. This gives you access to protections that do not apply to general guidance. For example, you may be able to refer an eligible complaint to the Financial Ombudsman Service.

FAQs

What is a pension annuity?

An annuity converts some or all of a defined contribution pension into a guaranteed taxable income. A lifetime annuity pays an income for the rest of your life while a fixed-term annuity pays for an agreed period, which can be between one and 30 years. The income offered will depend on factors such as:

  • How much of your pension you use
  • How long the income will be paid
  • Whether you want it to increase each year
  • Your age, health and lifestyle
  • Where you live
  • The rates and market conditions at the time.

What types of pension annuities exist?

The main options include:

  • Lifetime annuity — pays an income for as long as you live.
  • Fixed-term annuity — pays for an agreed period, after which you may receive a maturity amount that can be used for another retirement-income option.
  • Level or increasing annuity — provides an income that stays the same, or rises each year by a set rate or in line with inflation.
  • Single or joint-life annuity — joint-life pays a portion of your income to a dependent after you die.
  • Enhanced or impaired-life annuity — may provide a higher income when health or lifestyle factors suggest a shorter life expectancy.

You may also be able to choose how often you are paid and whether payments are made in advance or in arrears.

Can I change my annuity after buying it?

Most annuities have a cooling-off period, which is usually 30 days. After that period, the annuity generally cannot be cancelled or changed. The type of annuity is usually fixed at the point of purchase. It is therefore important to understand the terms fully before proceeding.

Do I need financial advice before purchasing a pension annuity?

There is usually no legal requirement to receive financial advice before purchasing an annuity, but it is a significant decision that can be difficult or impossible to reverse.

MoneyHelper offers free Pension Wise appointments to people with a UK defined contribution pension who are aged 50 or over. Some people under 50 may also qualify, including those retiring early because of poor health, those who have inherited a pension or those whose scheme permits early access.

Pension Wise provides guidance about your retirement-income options. A regulated adviser can go further by assessing your circumstances, recommending specific products or providers and explaining the tax implications of your options.

Financiable® does not provide financial advice or recommendations. We introduce you to advisers from FCA-authorised firms, and the initial consultation is free with no obligation to proceed.

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