Should I delay my annuity
purchase until the rate increases?
Annuity rates may start to increase towards the end
of 2010 as interest rates are expected to rise. However,
if you are waiting for this to happen before you commit
to an annuity then there are a
number of factors that you must consider. The calculator
below will help you.
- Each month delayed is a month of income
lost. It could take several years to recover this
lost income
- Interest rates may take longer to rise than
expected
- Annuity rates are generally falling as people
live longer and segregation of healthy\unhealthy
lives become more popular. By this we are referring
to the uptake of
impaired life annuities which have a negative
effect on annuities available for healthy lives.
- If you remain invested, will your pension fund
continue to grow or could it fall in value?
To help you decide, we have produced the following
calculator to measure the affect the variables above
changing. To keep matters simple we assume that the
pension remains level, single life, paid in arrears and
without ratings for impaired life. Also note, compound
growth has not been used for the pension growth rate.
If you have a guaranteed annuity rate from your
pension provider then
click for this calculator which will be more
suitable
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