P271 CJEFAX 201 Fri 15 Apr 21:25/16 5N5I j=S j 5 An E OF IN LATJOd E SIS TO 2. % ife m BoE GOVERtO warn of IMo ripks US FIpUlES p ouidh no 3nrpriy ( 209 NATWESa B b joe s Cm id r uc j n08 o likkji m0,164.6h + 77 43oOn $ 4.9 £pDM 2.k21 pt0.n0 Ef 9 9 2 FT cha 3d 8.f + n 6 P A) CEEFAX FI yNCE capitan an pro id a r h h Dnarm ,P,,, ,p,, ,,, , ,C,,,, ,,,,,, ,,, City News FUSE/FT30 ondon TharP271 CEEFAX 271 Fri 15 Apr 21:15/33 5NUITIES Ann ity rate ar calculat d 3ith reg r to if xp ctanc , r t ns on fixed interest inveutm nus and life compan xp ns . h m ans that rate increas with age, and rise or fall depending on th return on th current i lds from mj£ism dated gilt£. 0 As an annuity is for life, there provide protection from early death, such as guarantee p ri d and spots 's bjnXfits. T T 0 Annuities can incrna3i each a 73 a hhdge against inflation. e CST FT 0 doP271 CEEFAX 271 Fri 15 !pr 21:25/01 3/7 ANNUITIES I Single or Joint Nife Ann5itieu A single life annuity ceases on the death of the annuitant, but you can choo3j to ha6e the 1nn5ity paymunt3 cmntinuj to your spouse if you die The spouse's annuity can bj reduced on the intents death, usually bz either 33.3) or 50). Gubrantei Periods Annuities can be guaranteed for a specified period usually 5 ou 10 years. The annuity pa:mints will bj made for that period, e6jn if the annuitant dies. CPA Rates: Joint Life 274 CPA Min CP— Women CP— Joint PLA RptrsP271 CJJFAX 271 Fri 15 Apr 21:28/43 ] 4/7 Escalating Annuities (EA) Annuities can increase by a fixed percentage, normally 3% ou 5% or in line with the retail 8rice1 index. "k On average an annuity increasing by U 5) compounded pju year will gi6e a starting income 30% less than a level annuity. Normally the EA whll overtake the level annuity after about 10 years. Although expensive in the short term escalation does 8roteat annuity payments from the kffects of future inflation. CPA Men CPA Women CPA Joint PLA RaterP271 CEEFAX 271 Fri 15 Apr 21:10/12 G ANNUITIES Frequency of Payment Most annuities ar quoted monthly. By convention CPAs are quoted in advbnce and PLBs in arrears. Advance: Pa mint is m1dj at zhj beginning of the pjrigd. Arrears: At the end of the period. Payments can also bj made annzally, half yearly or quarterly. Annually in arrears will gi6e the highest pa mint, but, quarterly in arrears is the most common alternative to monthly payments. P M n P Women P J in P tP271 CEEFAX 271 Fri 15 Apr 21:01/47 6/7 ANNUITIES Taxation Compulsory Purchase Annuities are taxed as earnj income and are usually paid net of asic rate tax. Purchased Life Annuities. Each payment includ u a repayment as part of the original capital, known as the capital content. This is deducted from the gross annuity bjf rj appl9ink your ta| rate. Thus PLAt have a significant ta| advantage because tax is paid only on a small amount of each pa m nt. CPA Men CPA Women CPA Joint PLA RateP271 CEEFAX 271 Fri 15 Apr 21:19/31 G AVNUITJES The annuity tables on 8ages 272-5 shot the top pa9ing companies for a purchase price of £10,000. Higher purchase prices will gi6j a slightly higher rate. Rates will also bj affected by exact age and choice of benefits. $here are companie which offer good rates but are only available to specific groups. These are not quoted, eg, The Royal National Pension Fund for Nurses. CPA Annuity Rbtes: Male 272 CPA Annuity Rates: Female 273 CPA Joint Life Rates 274 Purchased Life Annuities 275 CPA Men CPA Women CPA Joint PLA Rates