Frequently Asked Questions
- What is a pension annuity?
- What if I have an existing medical condition or factors that affect my health?
- Do I need to retire before I buy an annuity?
- Can I buy an annuity without using an adviser or broker?
- How long does the process take?
- Can I cancel?
- What is the benefit of including a guarantee period?
- How is my annuity income calculated?
What is a pension annuity?
A pension annuity enables pension savings to be converted into an income in retirement which will continue for the rest of your life. You can buy an annuity with monies saved in money purchase or similar pension schemes. If you have a final salary or similar pension, you will usually be paid an income directly from the pension scheme, and therefore you cannot buy an annuity.
What if I have an existing medical condition or factors that affect my health?
Hodge Lifetime's annuity does not take these factors into account when determining your annuity rate. As a result, you may find a higher level of income with another provider which takes health factors into account.
Do I need to retire before I buy an annuity?
No. You can buy an annuity at any time provided you meet the age eligibility criteria.
Can I buy an annuity without using an adviser or broker?
Yes, but not from Hodge Lifetime. Some providers will allow you to buy an annuity directly, but we prefer that everyone uses the help of an adviser or broker. This makes sure that you are aware of all of your options, and that you have compared all of the annuity rates available in the market.
How long does the process take?
This mainly depends on your pension provider. Assuming that they send us your pension funds within two weeks, the whole process should be completed within a month.
Can I cancel?
An annuity is supposed to be a commitment for the rest of your life. In common with all annuities, once the cancellation period has expired you cannot reverse this transaction. You have 30 days from the date you sign the application form to change your mind.
What is the benefit of including a guarantee period?
A guarantee period ensures that your annuity will continue to be paid even in the event that you die in the early years. The guaranteed amount will continue to be paid to your dependant or to your estate.
How is my annuity income calculated?
Your annuity income is determined based on your life expectancy and on long term interest rates prevailing at that time.