What is a Fixed Term Retirement Plan?

Regular income, ending with a lump sum

Our Fixed Term Retirement Plan, like an annuity, lets you use your pension pot to buy a guaranteed income, but for between three and 25 years, with a lump sum at the end. This product may be for you if you want guaranteed income for now and the ability, after the plan ends, to make new choices.

  • Secure and guaranteed income

    A guaranteed, regular income you can plan around, with confidence.

  • Payment options

    Your payments can be made monthly, quarterly, half-yearly or yearly and either at the start (in advance) or at the end (in arrears) of the payment period.

  • A fixed or increasing income

    You can choose a fixed income that always stays the same or set your income to increase each year by anything up to and including 10%.
  • Gives you control

    You can set the plan length, the regular income amount and the lump sum ‘maturity’ value.

  • Creates options later in retirement

    At the end, you can use the lump sum as you see fit. If your health was to deteriorate by the end of the plan you may be able to buy an annuity at a better rate.

  • Supporting your loved ones

    If you should die during the term of the plan, we will continue to pay regular income payments to your beneficiary or estate until the end of the term of the plan.
  •  Withdrawal from the lump sum

    You can choose to make up to three withdrawals at any time during the term of the plan, subject to a minimum withdrawal of £5,000 each time. More details on withdrawals and the Guaranteed Minimum Payment Period are in the Key Features document.

  • Am I eligible?

    You must be aged between 55 and 85 and have at least £10,000 left in a pension pot to buy one after you’ve taken your tax-free cash.

  • I want some flexibility later

    If you'd like a guaranteed income but also want to give 'future you' some options, this may be for you. You’ll be able to decide what you want to do with the lump sum when the plan ends.

  • We're both fit and healthy

    This product doesn't take your health or lifestyle into account when working out your income. If you or your partner have any health or lifestyle risks now, you could get a higher income from a Pension Annuity or other products that assess your health. If you choose the Fixed Term Retirement Plan, though, you can still get an annuity in the future with the lump sum you get when the plan ends.

  • I want security from risks

    Your income is guaranteed and is not affected by the performance of investment markets.

  • Tax-free cash

    You can take up to 25% of your pension pot as tax-free cash. If you don’t take the tax-free cash at the start of your plan, you can’t take it later.

  • Taxable income

    Payments will be taxed as income, which could affect any benefits you claim. The amount of tax you pay on income from the plan will depend on your circumstances, and may change based on your income tax rate.

  • Higher income means a smaller lump sum

    Choosing a higher income will reduce the lump sum, similarly if you choose a lower income, you could get a higher lump sum. You can also choose not to take an income at all and just get your lump sum at the end.

  • With security comes less flexibility

    You won't be able to change the amount you get, but if your circumstances change you may be able to cash it in or transfer it to another pension product.

  • When it's gone, it's gone

    Once the plan ends you won't have this regular income any more. It’s important to consider if you will have another source of income to replace it.

  • Health risks not recognised

    If you or your dependant has a health or lifestyle risk, a Pension Annuity, or products that take your health into account, may offer a higher income.

  • Mind out for inflation

    If you choose to get the same income every year, this means with inflation, it may not buy as much in the future. Even with modest inflation, 20 years may halve the power of a £1 - will your lump sum be enough?

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If you know what you want and have your paperwork to hand, it only takes about 15 minutes to get an online quote.



Next steps

Now that you’ve learnt more about our Fixed Term Retirement Plan, why not look at other products available as part of your shopping around. Other providers may have more appropriate products or be able to offer a higher level of retirement income.

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Need some help?

Making well-informed decisions about financing your retirement is important so it’s worth shopping around and using available guidance and advice, before you buy. Other providers may have more appropriate products or be able to offer a higher level of retirement income.


Retirement guidance

Pension Wise from MoneyHelper

You can get guidance from the government's free and impartial service to help make your money and pension choices clearer.

The availability of appointments can vary between a few days and several weeks, so if you need guidance, it's a good idea to book an appointment slot now:

0800 011 3797
9am to 5pm, Monday to Friday.
Calls may be recorded or monitored. 

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Our colleagues are always happy to help with your questions or to help you apply for a quote.


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You usually need to pay for their service and in return they recommend how to make the most of your pension given your circumstances.

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