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Fixed Term Retirement Plan

Guaranteed income ending with a lump sum

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.
  • 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.

Full details on these features are in the Key Features

  • 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 partner 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
    Your lump sum amount is fixed at the beginning. 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?

When you purchase our Fixed Term Retirement Plan, we aim to make the process simple, clear and jargon free. It can take as little as 15 minutes to get a personalised quote with us. You can save your quotes and come back later once you've shopped around. You can also complete your application online.

Here’s a summary of the process you’ll follow if you quote and apply online.

  • Pension Wise free guidance appointment
    Pension Wise is a government service from MoneyHelper that offers free impartial pension guidance. Available if you're 50 or over, you should consider having a free Pension Wise appointment, before you decide how to access your pension.
  • Before you start
    We’ll run through some questions and considerations to make sure you’re ready to get a quote online.
  • About you and your pension pot
    We’ll ask some details about you and about any pensions you’d like to use to get a quote.
  • Choosing a guaranteed income product
    As well as getting a quote for our Fixed Term Retirement Plan, you can also quote for our Pension Annuity and Cash-Out Retirement Plan. You’ll be able to get multiple quotes on different products to see how the different options affect your level of income.
  • Get multiple quotes
    You'll be able to select different options to see what income you could get and create multiple quotes to compare what these look like. Unless we tell you otherwise, the quote you choose is guaranteed for 40 days.
  • Shop around
    It's important to shop around and get as much guidance and advice as you need before you make any decisions.
  • Buying an Fixed Term Retirement Plan
    When you’re ready you can apply online for the product using the guaranteed quote you saved previously.

Ready for a personalised quote?

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

If you're 50 or over, you should consider having a free Pension Wise appointment, before you decide how to access your pension.

Retirement income products compared

Guaranteed income (Pension Annuity)

Fixed Term Retirement Plan

Cash-Out Retirement Plan

Flexible income (Pension Drawdown)

Can it provide a regular pension income?

Yes

Yes

Yes

Yes

Can I choose a guaranteed income each month?

Yes

Yes

Yes

No

Is my income guaranteed to last my whole life?

Yes

No

No

No

Can I change how much I get?

No

No

No

Yes

Am I exposed to market movements, up or down?

No

No

No

Yes

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See how you can protect yourself from fraud.

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 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.

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

0800 138 3944

8am to 6.30pm, Monday to Friday.
Calls may be recorded and monitored.

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Speak to us

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

0808 304 9447

Monday to Friday
9am to 5pm
We may record and monitor calls.

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