Buying a joint life annuity; how to make sure you both get a pension income in retirement
If your husband or partner buys the wrong type of annuity, you could be left without a pension
Thousands of widows and surviving partners are left without a pension every year after their husband or partner dies. That’s because their husband/partner has bought a 'single life' annuity with their pension pot, which is only designed to pay a retirement income for as long as he or she lives. Once they’ve died, it doesn’t pay a penny. In order to get a pension after your husband or partner dies, they have to buy what’s called a 'joint life' annuity. Ignore the jargon - it's a really important issue!
If you’ve reached state pension age and are on a low income, you may be able to claim Pension Credit
I’ve had a couple of emails about Pension Credit recently, from women who’d like to know if they’re able to claim it. Pension Guarantee Credit is available to you if you’re on a low income and have reached state pension age, and Savings Credit is paid when you reach 65. Figures from Age UK show that one in three people who are entitled to Pension Credit don’t claim it.
What is an annuity and how does it pay an income in retirement?
When you retire, depending on the type of pension you have, you may have to buy an annuity. What is it and how does it work?
If you have a pension where the amount you receive when you retire is not linked to your salary, then you have a choice about how you access the money in your pension fund. You can take up to 25% as a tax-free lump sum, but for most people, that means buying an annuity with the rest of the fund. This article explains the basics of what an annuity is, how you buy one and what it does.