Fixed Term Retirement Plan

Overview

Our Fixed Term Retirement Plan is a fixed term contract that will pay you a defined regular income over a term of between 3 and 25 years, with a fixed lump sum payable at the end of the term.

To apply you must be aged between 55 and 85 and have at least £10,000 to invest after you've taken any tax-free cash you might want to withdraw.

What are the options?

Our Fixed Term Retirement Plan can be tailored to your needs. The options you choose will determine your income.

Fixed-term retirement plan options
Option Description
Tax-free cash You can take up to 25% of your pension pot as a tax-free cash sum. If you don't take it at the start of your plan, you won't be able to take it later.
Amount of income or term of your plan Choose how much income you want, how often it's paid, and the lump sum at the end of your plan term. Choosing a higher income will reduce the lump sum, choosing a lower income will increase the lump sum. You can choose to receive no income at all with just a lump sum at the end of your plan term. Once you've decided and started your plan, you won't be able to change these amounts.
Death benefits  Choose if you would like our income and lump sum value to be paid to a nominated beneficiary if you die before your plan ends.

How does it work?

You choose the amount that you'd like to contribute from your pension pot or existing plan into a Fixed Term Retirement Plan.

You decide on the term (the time period that the plan will last for), the level of fixed income you receive and how often you receive it. You can decide to include any death benefits. For example, a guaranteed minimum payment period during which the income and maturity amount will continue to be paid to your beneficiaries if you die before the end of the term.

For details of the actual amount you could receive, get a quote online.

Is it suitable for me?

Fixed Term Retirement Plan - is it suitable for me?

It may be suitable for you if: 

  • You are aged between 55 and 85.

  • You want a contract that will pay you set regular amounts over a period of your choice.

  • You want a fixed maturity value at the end of the plan term to decide what to do with, for example to buy another retirement product, buy a lifetime annuity or simply take the money out of your plan.

  • You don't want your pension pot to be subject to any investment risk.

It may not be suitable for you if:

  • You want to withdraw cash amounts from your plan as and when you choose.

  • You want to change the amount of income you receive during the plan term.

  • You want an income that lasts for your lifetime and does not end at a set date in the future.

  • You or your partner have certain lifestyle risks or have been diagnosed with a more serious medical condition(s), which could lead to your income being higher through a product that assesses your health.

Example Fixed Term Retirement Plan

Katherine is 55 and would like to top up her existing income.

  1. She has a pension pot of £50,000 and wants an income over 5 years.

    She decides to pay into a Fixed Term Retirement Plan. This plan will give her a regular income each year, and a fixed amount on maturity which Katherine can choose to use as she wishes.

  2. Fixed income received each year from Katherine's contribution:

    £4,900

  3. Plan term:

    Five years

  4. Income:

    £24,500

  5. Maturity amount:

    £27,800

  6. The total amount due to be paid, over the full term of the plan, before income tax is:

    £52,300

  7. The income and maturity amount will continue to be paid to her beneficiary if she dies before the end of the term.

  8. These are example figures only. For details of the actual amount you could receive, get a quote online.

Important things to consider

  • You can't make any changes to the plan once it's started.
  • If your circumstances change during the term of the plan, you will be able to cash it in or transfer to another scheme.
  • As you'll receive a fixed income and maturity value, inflation will reduce the buying power of your income over time.
  • Plan payments are considered as income, and subject to income tax. This could affect any benefits you claim.
  • The tax you pay on the income from the plan will depend on your individual circumstances and can change. This may affect the income you receive from us. 
  • At the end of your plan income will stop.
  • You may be able to get a higher amount of income through a product that assesses your health and offers higher returns for certain lifestyle and medical conditions.
  • At the end of your plan your income will stop and you'll need to decide what to do with your maturity value. Find out about your maturity options.

Frequently asked questions

How can I buy a Fixed Term Retirement Plan?

You can apply directly for our Fixed Term Retirement Plan, or there is a version of this product available through financial advisers.

What happens at the end of my plan?

When the plan reaches its end date, no further income payments will be made. We’ll write to you confirming that your plan has ended. You’ll then need to decide what to do with your maturity value - we’ll continue to hold it until you contact us. Before you decide what to do we recommend you seek guidance and financial advice. This is an important decision and you must consider all of your options. Find out more about what to do with your maturity value.

If you feel you need help, we strongly recommend you seek guidance or financial advice. 

Your next steps

Ready to find out more?

You may choose to work through all the product sections below.

Or take a look at

Our Retirement Income Calculator allows you to quickly see what income you might expect from our range of retirement solutions.

Ready to get a quote?

You can get a quote online for any of our retirement products.