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What is an Annuity?

Annuities convert your pension savings into an income.

Be careful, any annuity purchased by pension funds or drawdown income will be taxed as income.

How do Annuities work?

An annuity is a financial product that enables you to convert your pension savings into a monthly or yearly retirement income for you to live on.

The amount you will get depends on factors such as how old you are; the younger you are when you retire, the less you get each year, and whether you want your annuity to pay an income to your spouse or partner when you die.

It's worth thinking about talking to a financial adviser about the best type of annuity and which company will pay you the highest income.

Open Market Option

If you have a pension fund, you should be told that as an alternative to buying an annuity from the company you have saved with, you have the option to take the fund to another company and buy it from them.

NB: Some older pension plans may have high levels of guaranteed annuity income “built in” to them and it is important to assess whether or not these are available to ensure they are not lost if the plan is moved to another company.

Annuity Providers

Annuity providers will be allowed to vary the amount of income they pay. You may wish to take less to begin with and larger sums later on. New rules will allow you to take a lump sum from an annuity, provided you agree to this when you buy one.

Your family may be allowed to be paid from your pension after you die if you include a guarantee period.

Different Types of Annuity

There are many different types of Annuity. Find out More »

The main types of annuity include:

  • Lifetime or Fixed Term
  • Single Life or Joint Life
  • Enhanced Annuities
  • Fixed income, Escalating Income or Investment-Linked Income

Pension Freedoms

Since April 2015 you will have been able to withdraw as much of the money you want to that you've saved into your pension, once you reach 55. You can also access your defined contribution (DC) pension (if you have one) as you choose from the point of retirement and not have to purchase an annuity.

Although the government has confirmed plans to increase the minimum pension age from 55 to 57 from 2028.

A pension is a long-term investment. The fund value may fluctuate and can go down. Your eventual income may depend upon the size of the fund at retirement, future interest rates and tax legislation.

Kennet Financial Services

Our aim is to offer clients Financial Peace of Mind and Real Value for Money

About us

Independednt Financial Advisers (IFAs) based in Devizes, Wiltshire

Our philosophy is simply to guide our clients through the various stages in their lives where expert financial guidance is required from an experienced and trustworthy adviser.

Our aim is to help our clients achieve their financial objectives in a tax efficient and easily maintained manner with clear, uncomplicated solutions.

The reward is being able to work at achieving a long and happy association with clients where trust and transparency are paramount in the relationship.

Advisers David Kinch and Ben Trow have many years experience working with Individuals and Businesses and have built a reputation based on trust and the ability to explain what can be complicated subjects in easy to understand ways both face to face and in writing.

We use our experience to cut through the jargon unfortunately plaguing our Industry to provide options and solutions tailored to your needs.

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We serve people best who:

  • have little time and/or expertise to manage their financial affairs
  • are seeking expert financial advice and/or investment review
  • want help to formulate and maintain a clear financial plan and strategy to make the most of their hard earned money
  • need a “sounding board”
  • want the discipline of a regular review of their finances
  • are seeking a sense of control, peace of mind and financial freedom
  • regard service and a trusted relationship as key to working with advisers of any sort

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Our Specialist Areas

The Financial Services Authority does not regulate Taxation & Trust advice or Will writing.

Kennet Financial Services provides services like financial planning and financial advice, tax, personal pension advice as well as business advice. We also provide many other types of advice and private investing in Devizes, Wiltshire.

We offer a comprehensive financial planning service to include tax planning opportunities. We also provide a bespoke investment management service with an emphasis on strategic asset allocation.

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