Lifetime Annuity

What is a lifetime annuity?

Providing a guaranteed, secure income for life the lifetime annuity is the more common form of an annuity, especially with those looking for minimal risk in retirement.

The income you receive, taken on an annual or monthly basis, is decided at the outset by your provider and is based on your purchase fund and the annuity rate offered.

Things to Consider

Although a lifetime annuity has little risk involved, there are a few things to consider before purchasing a lifetime annuity:

  • Once your policy is agreed, you cannot make any changes.
  • If your circumstances change, you can not come out of a lifetime annuity, and you are ‘locked in’.
  • On a level-income basis, inflation will reduce the real-term value of your income.
  • If you are looking for flexibility or the opportunity to review your options periodically, then drawdown or a fixed-term annuity may be suitable.