What are Flexible Annuities?

A flexible annuity quite literally refers to an annuity that provides a level of flexibility. Unlike conventional or level annuities which for the purpose of this argument can be classed as inflexible, flexible annuities allow the annuitant to potentially get a higher income based on investment performance. There are three types of annuity that are collectively known as flexible annuities including With-Profits annuities, Unit-Linked Annuities and Fixed Term Annuities. Flexible annuities are appealing because they offer the chance of a guaranteed income for life but are also accompanied by the opportunity of potentially increasing one’s income in the future. Conventional annuities are often criticised as being rigid and inflexible, even poor value because you are locked into the rate at the time of purchase. Flexible annuities allow the annuitant to invest some of their pension fund on the stock market and potentially increase their income in the future, whilst also providing a minimum level of income.

Flexible annuities give you control over the following…

  • Income
  • Investment
  • Insurance
  • Inheritance

What are the benefits of a Flexible Annuity?

  • Your income could grow in the future if your investment perform well
  • You can vary your income by choosing to take as little or as much (subject to limits) income as you need.
  • You can normally build in a minimum income gurantee
  • Plenty of choice when it comes to investment choices, you can choose the level of investment risk
  • Can include death benefits, guarantee periods as well as value protection

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