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Our fixed term plans

Guaranteed retirement income ending with or without a lump sum

Understanding our Fixed Term and Cash-Out Retirement Plans

Our fixed term plans (referred to by MoneyHelper as fixed term annuities) provide a guaranteed income for a set period of time.

We offer two fixed term plans, the Fixed Term Retirement Plan and a Cash-Out Retirement Plan.

Both of our plans let you use your pension pot to get a regular, guaranteed income for between three and 25 years. The difference between them comes into play when they end:

  • Our Fixed Term Retirement Plan pays out a lump sum when it ends
  • Our Cash-Out Retirement Plan ends without paying out a lump sum

Apart from that, they work in a very similar way to each other.

Why get a quote with L&G?

Compare products and options

As well as getting a quote for our fixed term plans, you can also quote for our Pension Annuity. You’ll be able to get multiple quotes on different products to see how the different options affect your level of income.

Flexible and convenient

Capabilty to quote and apply on any device in only around 15 minutes.   

Trusted retirement income provider

UK families have been trusting L&G to look after their finances for over 185 years. When shopping around for an annuity one in every three people choose us.

Our fixed term plans have the following key features:

  • A guaranteed income for a fixed period
    With both plans, you’ll get a guaranteed, regular income that you can absolutely rely on. If you go for our Fixed Term Retirement Plan, you can choose to get a guaranteed payment when your plan ends too.
  • Clear choices when you’re setting your plan up
    You can choose your plan’s length, how much it pays and when it pays out, and (if you go for a Fixed Term Retirement Plan) the lump sum you’ll get when it ends.
  • Payment options to suit your needs
    Your plan can pay out monthly, quarterly, half-yearly or yearly. It can pay out either at the start or at the end of that payment period.
  • A fixed or increasing income
    Your payments can either always stay the same or grow annually by up to 10%. If you opt for growth, your payments will start at a lower level.
  • Making withdrawals if you need a lump sum
    If you choose our Fixed Term Retirement Plan you can choose to make up three withdrawals at any time during the term of the plan, subject to a minimum withdrawal of £5,000 each time. Choosing to withdraw won't have an impact on your regular income payments because it's deducted from your lump sum.
  • Support for your loved ones
    If you die while your plan is running, it’ll keep paying out to someone you’ve chosen or your estate until it ends.
  • Stay tax efficient
    Setting up this kind of retirement income product is usually more tax efficient than taking money out of your pension pot as cash.

Eligibility

  • You have a Defined Contribution pension pot. 
  • Your pot is at least £10,000 (for a Fixed Term or Cash-Out Retirement Plan) or at least £5,000 (for a Pension Annuity).
  • You're aged between 54 years 9 months and 84 years 9 months.

Always compare what we can offer with what's available from other providers, as they may have more appropriate products or be able to offer a higher retirement income.

Need further help? See our guide to getting an online quote.

If you'd prefer to speak to our UK based Customer Services Team, we'll be pleased to give you a quote over the phone.

Call us on 0800 048 2446. Monday to Friday 9am to 5pm. We may record and monitor calls.

Which fixed term plan's best for you?

To choose between them, you just need to decide whether or not you want a lump sum payout when your plan ends.

Guaranteed income ending with a lump sum

Fixed Term Retirement Plan 

Our Fixed Term Retirement Plan, lets you use your pension pot to buy a guaranteed income, but for between 3 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.

Guaranteed income for a set period

Cash-Out Retirement Plan 

Our Cash-Out Retirement Plan lets you use your pension pot to get regular income payments for between 3 and 25 years. It may be a tax-efficient way to withdraw your whole pension pot, rather than taking it all in one go or it may be a  'bridge' to see you through to a future date, when you're expecting another source of income to begin.

Common fixed term plan questions

You’ll see that in some of the questions below we describe fixed term plans as fixed term annuities. Strictly speaking fixed term plans aren’t annuities. That’s why we never describe our own versions of this kind of product as annuities. But many people call this kind of product fixed term annuities, so we’ve reflected that in our questions here.

Yes they are the same thing. They both are designed to provide a guaranteed income with an optional lump at the end. The reason why these plans are not called 'fixed term annuities' is because they're written under flexi-access drawdown rules, which allows some flexibility in how they can be used.

Guidance helps you to identify and narrow down your choices in an impartial way. It won’t tell you what’s right for you but will explain your options and provide information so that you can choose what you want to do.

Advice considers your personal and financial circumstances and recommends specific products or actions to be taken that helps you achieve your goals. Your first conversation with an adviser will probably be free. But it’s important to check and confirm that, and also understand when and how you will start paying for any advice.

Guidance and advice guide

From 1 June 2022, the Financial Conduct Authority now requires pensions providers to refer customers to Pension Wise guidance and explain the nature and purpose of this guidance, when they decide to access their pension savings.

Pension Wise from MoneyHelper is a free and impartial Government pension guidance service.

Your decision about which options to choose is likely to be influenced by many factors, such as how much income or cash you need now and in the future. You should also consider your personal circumstances and the impact that your choices may have on taxation, State Benefits, Annual Allowances and any dependants.

You can either buy this directly through us or through a financial adviser. We recommend always shopping around and getting guidance or advice when you’re buying one. That’s because once you’ve bought it, you usually won’t be able to make any changes to it. So it’s very important to be sure that you’re making the right choices for you.

Different providers offer a range of different fixed term retirement income products and product options. In general, key decisions will probably include how long your product runs for, whether your payments increase over time, whether or not you get a lump sum payment when your product ends and what happens to your product if you die before its term ends.

The income from our Cash-Out Retirement Plan will stop once the final payment is made. For our Fixed Term Retirement Plan, you will need to decide what to do with your lump sum.

That depends on what the markets are doing and what a particular provider is offering. The best way to find out is to shop around for the best rate, which we always recommend doing.

That depends on your financial goals and circumstances. If you want the security of guaranteed payments for a period of your choosing, this kind of product could be a good choice for you.

Once you’ve bought this kind of product, you usually can’t make any changes to it. Any income from it will be taxable and could effect your eligibility for any state benefits you’re getting. If inflation is high, you might find that your regular payments are worth less in real terms. And once your product ends, that’s it. You’ll need to make plans to replace any income from it.

You can usually only buy this kind of product when you’re aged between 55 and 85. If you can buy one, your personal goals and financial circumstances will be more important than your age.

Next steps

Now that you’ve learnt more about our fixed term plans, 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 how to finance your retirement is important so it’s worth shopping around and using available guidance and advice, before you buy:

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Retirement guidance

Pension Wise from MoneyHelper

The government’s free and impartial service, offering guidance to make money and pension choices clearer for over 50s.

To find out more or book an appointment online click below or call.

0800 011 3797

Monday to Friday, 9am to 5pm.
Calls may be recorded and monitored.

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Retirement advice

Retirement Advice Service from Legal & General

Our advisers are experts in retirement regulated by the Financial Conduct Authority, so you can trust them to provide impartial advice and a personal recommendation that’s right for you.

0808 304 9155

Monday to Friday 9am and 5pm.
Calls may be monitored and recorded.

Speak with us

Speak with us

Our colleagues in Cardiff are always happy to answer your questions.

0800 048 2446

Monday to Friday 9am to 5pm.
Calls may be monitored and recorded.

Our retirement income experts
Joe Mclean - Senior Product Manager

Joe Mclean

Senior Product Manager, Retail Annuities

Joe manages our three guaranteed income retirement pension products – our Fixed Term and Cash-Out Retirement Plans, and our Pension Annuity. He makes sure they offer everything our customers need, are competitive in the marketplace and meet all relevant risk and regulatory requirements.

 

 

 

More about Joe
Nick Theobald - Product Technical Manager

Nick Theobald

Product Technical Manager, Retail Annuities

Nick’s been with us for his entire career, spending over 35 years helping our customers in many different ways. Since 2019, he’s been a Product Technical Manager focusing on annuities. Previously, he’s also worked as a Conduct Risk Monitoring Consultant, Senior Pension Specialist and Service Delivery Manager, among other roles.

More about Nick