# 44 & no pension, help!



## Brambles (21 May 2008)

Hi all, my first post but far from my first visit. I've been lurking for some time! My questions:

Firstly, what are fixed annuities - I'm told that there are currently no pension plans supplying such a thing, but what are they?

Secondly, these fixed annuities are part of a pension plan that's paid up. The transfer balance is €6,000 odd and I'm tempted to transfer it to another pension, most likely a PRSA because I want the ability to stop and restart payments together with a facility to make lump-sum contributions. But if I transfer it I lose the fixed annuities. Those things again! What are they? I'm 44 next birthday, classified as self employed and I've absolutely nothing done about a pension except for that mediocre €6,000. Should I just leave the 6k where it is - with Hibernian - and eventually avail of those fixed annuities and start a new plan? My income fluctuates wildly from month to month. What do you think? I'll appreciate your advice?

Brambles


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## Don_08 (21 May 2008)

By fixed annuities - I think you mean guaranteed annuity rates.  If so - do not transfer.

Was the policy set up prior to the early nineties?  And can you still pay into it?

Any pension I have come across with guaranteed annuities represent very good value for money.

The policy will state for example that on retirement at 65 you can purchase a pension of €1 p.a. for €11 - the current cost would be something appraoching €20.


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## Brambles (21 May 2008)

Don 08, I'm afraid I can't make any further payments, it's paid up. I opened it in 1991, I think. I will check the policy if I can find it! Thanks for your help


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## Don_08 (21 May 2008)

Well you can set up a PRSA and pay in future conts to it - but no point in transferring your old pension.  Definitely keep a hold of it.


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## Brambles (23 May 2008)

Don 08 and any other helpers: I've found the policy document and it says the following:

The Society guarantees an annuity rate of 9.82% for plans effected now (now being 1991)

The amount of guaranteed annuity (at age 60) for each £100 of capital sum is 9.82

Can somebody put that in ordinary language for me? Does it mean £9.82 for each £100.00 of capital?

It goes on to say: 'such annuity to be payable monthly in arrear for a guaranteed period of 5 years and continuing thereafter during the lifetime of the Grantee without proportionate payment to the date of death'

That last bit really confuses me.

Furthermore the Schedule says: If the Grantee survives until benefit date a Capital Sum comprising IR£12141 with Irish Compound Bonus which shall be applied to purchase an annuity in accordance with General Provision 8 (Provision 8 is what's already above)

More confused than ever!


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## LDFerguson (23 May 2008)

It's a guaranteed annuity rate.  And a nice one at that.  If your fund is worth €10,000 at age 60, you'll get a pension of €982 per year for life from it.  You won't get a better annuity rate elsewhere at the moment.


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## Don_08 (3 Jun 2008)

Brambles said:


> It goes on to say: 'such annuity to be payable monthly in arrear for a guaranteed period of 5 years and continuing thereafter during the lifetime of the Grantee without proportionate payment to the date of death'
> 
> That last bit really confuses me.


 

This bit means that your pension is payable from age 60 until your death, payable monthly in arrears.  Whatever the date of death is, the pension will cease then, with the previous payment,  So if you died on the 20th of a month, there would be no credit for 20/30 of the monthly payment.  If you die between age 60 and 65 ( after drawing the pension at 60), then the pension will continue to be paid to your estate until age 65. 

LDFerguson has described the guarantee above  - very generous terms.  If you had €10,000 to purchase a pension from 60 with a 5 year guarantee for a male today it would only buy you about €620 per annum.  So a very good deal.

The last bit about the capital sum - would have been the value of your benefit when statement was issued - this will have increased up with the bonuses declared by the life assurance company annually - and there would normally be a terminal bonus at age 60 also.  No harm in getting an updated value from them for your own records - but would not do anything with this policy until age 60.


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## Brambles (3 Jun 2008)

Don_08 & LDFerguson, I'm most grateful to you both, a really great help.


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