A single premium annuity will provide a retiree with a steady income stream during retirement.
If you choose to retire early but do not wish to claim your National Insurance benefits immediately, your investment/savings portfolio can be used to buy an annuity to commence immediately, which will bridge the gap between retirement and the start of your National Insurance benefits.
If you are part of a Defined Contribution pension plan, your entitlement from that plan can also be used to purchase an immediate annuity which will provide you with an income during retirement.
Investing in an immediate annuity when you reach the end of your mainstream job or career removes the possibility of outliving your savings. You are however exposed to inflation as the income stream for a SPIA is fixed for the remainder of your life. An annuity with a fixed rate of increase can be purchased to reduce the impact of inflation in exchange for a reduced monthly payment in the early years of the annuity.
You may consider investing in an immediate annuity earlier, to take advantage of any income tax incentives, pay less taxes and have more disposal income.
If you have savings and an investment portfolio targeted for retirement income but are not ready to retire, you can consider investing in an annuity with a future commencement date. Should you die prior to the commencement date of the annuity, your spouse or beneficiary will receive a determined lump sum benefit.
Provider of long-term benefits for over 180 years
Heritage of strength, stability and financial prudence.
Publicly traded company listed on the Toronto stock exchange.
Strong governance structures.
In partnership with world-class asset managers and reinsurers.
Rated “A- Excellent” by AM Best for financial strength
Rated BBB+/Stable by Standard & Poor’s and Fitch for ability to pay its debts.
Annuities paid monthly in advance.
A fixed or annually increasing monthly payment to the annuitant for the remainder of their life.
Payments can be guaranteed to be made for 5, 10, 15 or 20 years from the start of the annuity in case there is a beneficiary to be provided for.
An annuity can be continued to a surviving spouse at a rate of up to 100% until their death. This can operate in conjunction with the guaranteed payments, where those payments are exhausted before the spousal rate takes effect.
Payouts can begin immediately in the case of the SPIA or at some time in the future for the SPDA.
The death benefit for a SPIA will be based on the payout option selected by the retiree.
The death benefit for a SPDA is the current value of the annuity at the date of death and will be paid to a surviving spouse or a named beneficiary in the event that the annuitant dies before any payments are made. Alternatively, the death benefit can be specified by a schedule at the various attained ages.