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Enhanced Annuities

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What are Enhanced Annuities?

Enhanced annuities work in the same way as a standard pension annuity but also take into account your lifestyle and health conditions. If you qualify for an enhanced annuity it will provide you with more income for the rest of your life than a standard pension annuity would provide. The structure of the enhanced annuity is the same as a standard pension annuity:

The amount of income you will receive from your annuity is dependant on the amount of money you have built up in your pension investment, your age (life expectancy) and annuity rates offered at the time of purchase.

Other factors such as whether you want income to stop upon death (single life) or continue to be paid to a partner (joint life) and whether you require indexation to apply to your income will affect the level of income offered.

 The rates offered by different companies can vary significantly and using your open market option to let someone such as us to shop for the best enhanced annuity rate makes sense.

There are many conditions that can result in an enhanced annuity rate we will help you determine if you are eligible. In broad terms the conditions fall into two categories: lifestyle conditions and health conditions.

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Lifestyle Conditions

Enhanced Annuities

Lifestyle conditions look at what you do and how this could affect your life expectancy. Factors that are typically considered include:

Smoking
If you smoke cigarettes, cigars, or pipe tobacco then you may qualify for an enhanced annuity.

Alcohol
Regularly consuming more than around 50 units a week (a pint of beer is normally 2 units) will normally result in an enhanced annuity

Weight
If your body mass index (BMI) is above average you may qualify for an enhanced annuity.

High Blood Pressure
If you have or have had high blood pressure and you are taking medication to control it you may qualify for an enhanced annuity. We will need to understand your medication and your readings as well as dates when you were diagnosed.

High Cholesterol
If you have had high cholesterol and are taking medication you may qualify for an enhanced annuity. We will need to understand your medication and your readings as well as dates when you were diagnosed.

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Health Conditions

Enhanced Annuities

When the pension providers look at health conditions, they are taking into account the impact that these conditions may have on your life expectancy. Below is an indication of some of the conditions that may qualify but this is not exhaustive.  

Cancers
Including leukaemia, lymphoma, tumour, and growths. If you have suffered with cancer you may qualify for an enhanced annuity. We will need to understand the type of cancer when you were diagnosed and what treatment you have had or are having.

Heart Conditions
Including Heart Attack, Angina, Valve disorders, Atrial Fibrillation. If you have been diagnosed with any heart conditions you may qualify for an enhancement. We will again need to understand the medication and treatment you have received.

Diabetes
Including both type 1 and 2. We will need to understand the type of diabetes and the treatment you are receiving. 

Stroke
Including both major and mini strokes. As well as the treatment and medication we will need to understand the impact the stroke has had on you.

Respiratory/lung disease
This includes CAOD and COPD, Emphysema, Asthma, Bronchiectasis. Any of these conditions can provide an enhanced annuity. We need to understand the impact on your lungs, the impact on your daily life as well as the medication that you are taking.

Multiple Sclerosis
We need to understand the medication and impact that it is having on your life to enable us to identify what level of enhancement we can achieve.

Other Neurological Diseases
Including Senile Dementia, Vascular Dementia, Alzheimer’s Disease, Parkinson’s Disease could all provide an Enhanced Annuity. 

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Enhanced Annuities

If you are on any medication and your condition is either controlled or not you or if you have been hospitalised you may qualify, we suggest that you tell us about all conditions so we can identify what may qualify for an enhanced annuity. 

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Enhanced Annuities

There is a significant difference between the income you can receive from the various pension providers which may not be made obvious to you. We have the knowledge and experience to shop the market for you to obtain the most suitable option. We aim to achieve bespoke full underwriting to maximise the income available.

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important things you should know

FREQUENTLY ASKED QUESTIONS

Enhanced Annuities

Most pension investments allow up to 25% to be taken as a Tax Free Lump Sum. Anything drawn over this amount will be subject to income tax at your highest marginal rate. Tax will usually be paid under an emergency tax code with any overpaid tax repaid in the following tax year or earlier if you put a claim into HMRC.

Click here to calculate the amount that will initially be deducted.

Also known as a ‘Money Purchase’ pension this is a pension where the benefits are not defined and the value of the pension investment will depend entirely on how much money has been paid in and what return on the investment has been achieved.

Often referred to as a ‘Final Salary’ pension which is where the benefits that the pension will provide at retirement are defined and not dependent on how much money has been paid in. These types of pensions do not have a published investment value though it is usually possible to obtain what is known as a Cash Equivalent Transfer Value (CETV) where the scheme administrators will calculate how much they are prepared to let you have if you forgo the defined benefits built up whilst you were a scheme member.

Tax will most likely have been deducted under PAYE rules using an emergency tax code. You can either wait until HMRC reconcile your tax affairs in the next tax year or claim for early repayment of any overpaid tax by using form P53 or P53Z. These forms are available from www.gov.uk. 

You cannot normally access the money in your pension before age 55.

Our business model involves us asking you a series of questions designed to enable us to gather sufficient information and understanding of your requirements that we can present you with information on all of the options available to you. We aim to do this in such a way that you are fully empowered and confident enough to make an informed decision as to the best outcome for your personal circumstances. If at any time during the process it becomes evident that you require and/or need formal recommendations for a particular course of action and we will refer you to an independent financial adviser.

Enhanced Annuities

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Enhanced annuities work in the same way as a standard pension annuity but also consider your lifestyle and health conditions. If you qualify for an enhanced annuity you would expect it to provide more income for the rest of your life than a standard pension annuity would provide.

Lifetime Annuities

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A lifetime pension annuity is designed to provide you with an income and is payable for the rest of your life as a minimum. The funds that you have saved into your pension pot are used to purchase an annuity either from your existing pension company or from a new pension income provider.

Fixed Term Annuities

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A Fixed Term Annuity is a type of Guaranteed Drawdown product designed to allow you to access your pension in a more flexible manner than purchasing a set income for the remainder of your life which is what a lifetime pension annuity does. They provide a guaranteed return on your investment.

Flexi Access Drawdown

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Flexible Access Drawdown products provide a flexible way to take your pension and range from relatively low risk products with guaranteed returns to high-risk products investing in all manner of asset classes. Whilst providing flexibility they do not give a guaranteed income for the whole of life. 

Releasing Tax Free Cash

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When you are 55 or over you can access your pension and, if you wish, take a tax-free lump sum. You can then invest the remainder in a pension product and either take an income or keep it invested. You can normally take up to 25% of your investment tax free and use this money as you wish.

Tax Free Lump Sum

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If your pension has not been crystalised (accessed previously) you can take a tax-free lump sum from the pension investment. This is normally in the form of a 25% tax free lump sum payment, but some types of pension schemes do have enhanced benefits and permit more than 25% to be taken.

State Pensions

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The Basic State Pension is available to men born before 6th April 1951 and women born before 6th April 1953 and the New State Pension available to those born later. We have links to the Government information pages and the State Pension Age Calculator and a link to obtain your State Pension Forecast.

Equity Release

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Is a way of taking some of the equity (investment wealth) built up in your property as tax-free cash to provide additional income in retirement or to pass over inheritance money to the family before dying, repay other mortgages or borrowing or to just spend on something you have always wanted.  

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What areas do we cover?

With our office in Ilminster we can provide face to face meetings for people in Taunton and Yeovil. We are may also be able to arrange face to face meetings in the areas of Barnstaple, Bridgwater, Glastonbury, Shepton Mallet and Wells areas. 

We also provide our reliable pensions services to clients in Dorset, Somerset, Gloucester, Wiltshire, Bristol, Cornwall, Dorset and Somerset.       

We are happy to have video meetings with people and therefore can provide a visual meeting to anyone in the UK. We are happy to talk through your options over the phone regardless of your location, so we can discuss your needs. We also are very happy to communicate with you through email which many customers now prefer, we can therefore provide a full UK coverage.