Retirement income

Retirement Income

Find out how the Saga Annuity Service may be able to help you get more retirement income from your pensions.

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0800 068 6228

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The Saga Annuity Service is provided by Legal and General.

How does it work?

A pension annuity converts your pension fund into a regular income for life. Your pension provider will normally offer you an annuity when you come to take your benefits, but what many people don’t realise is that they can shop around and potentially get a better deal through other annuity providers. See below for how the Saga Annuity Service can help.

Key aspects

  • The Saga Annuity Service team is experienced in providing annuity solutions and can help you through the process of setting up your pension annuity. 

  • Flexibility to choose an income solution to suit you. You can choose to take a fixed income. Alternatively, you can choose an income that increases each year. However, this will give you less income at the outset than a fixed solution.

  • Choose whether your income is paid monthly, quarterly, half yearly or yearly and whether you receive it at the start (in advance) or at the end (in arrears) of the payment period. 
  • A pension annuity will pay you an income for as long as you live and will normally cease to be paid when you die. However, you can arrange for your income to be paid to a surviving spouse, registered civil partner or financially dependent partner after your death.

What are the benefits?

  • A choice of how and when you would like to receive your money.
  • A secure income for the rest of your life.
  • A guaranteed, minimum income payment period of up to 30 years, e.g. if you die 15 years into your 30 year term, a guaranteed income would be issued for the remaining 15 years to your beneficiary. The period you can choose will be less if you're aged 70 or over.

  • All of the paperwork will be done for you, helping to remove stress from the process. 

Important information

Understanding the risks

The decisions you make now concerning your retirement income could affect you for the rest of your life, so it’s vital you have all the information possible.

It is important that you shop around for the best annuity rates. The Saga Annuity Service helps you to make informed decisions regarding pension annuities and your retirement income.

Reasons to choose Saga for your annuity

1. Exclusive access to the Saga Pension Annuity

The Saga Annuity Service offers a pension annuity that is exclusive to Saga, so if you're using a financial adviser to research annuities, don't forget to ask us too - we may be able to secure a higher income for you. The Saga Annuity Service is provided by Legal and General.

2. Access to an enhanced annuity solution

If you suffer from certain lifestyle risks or more serious health concerns, you may be eligible for an enhanced annuity. Smokers, overweight, underweight and people that suffer with a high blood pressure are amongst those who can all benefit from better rates by answering some simple questions.

Different annuity providers have different qualifying criteria for their enhanced annuities, so you should get quotes from as many providers as possible. If one provider doesn't offer you an enhancement, you shouldn't assume that will be the case for all providers. Some providers may ignore lifestyle and medical factors that other providers will take into account. 

How it can help

By combining all of your pension pots into one annuity you can know exactly how much income you are going to receive - giving you peace of mind by knowing what you can spend on a monthly basis.

Helping you decide

As you approach your chosen retirement date (or possibly before if your circumstances change), you will need to consider your options. You’ll also need to review your current outgoings and the level of income you will need in order to maintain a standard of living that is acceptable to you. If you’re unsure of your options, we strongly recommend that you take advantage of the free and impartial guidance service set up by the Government, called Pension Wise. If you are then still unsure, you should speak to a financial adviser.

What else may be relevant?


Income Calculator
Use our free calculator to find out how much income you could receive.

Frequently asked questions

Below are some of the most frequently asked questions, which could help you to decide whether or not a Saga Annuity is worth considering further.

Can I buy a pension annuity without going through a financial adviser?

Yes. If you know that you want an annuity, call the Saga Annuity Service on  0800 068 6228. One of the team will be able to provide you with a quote and, where appropriate, an application pack. It is helpful, but not essential, if you have details of your pension provider and pension fund value when you call.

Do I have to buy a pension annuity from my current pension provider?

In the majority of cases you won't have to buy your pension annuity from the same company that provides your pension scheme. You can shop around, as not all providers offer the same pension annuity products and each calculates its own annuity rates. Shopping around for your annuity (commonly referred to as taking the Open Market Option) could enable you to obtain a larger pension income.

Do I need to have a minimum pension fund to buy a Saga Pension Annuity?

Yes. The minimum pension fund we will accept is £1,000 (after payment of any tax-free lump sum).

Do I need to stop working before buying a pension annuity?

No, you don’t have to stop working to start taking your pension benefits. However, if you're in a company pension you may need to check what the scheme rules will allow. The earliest you can normally buy a pension annuity from is age 55.

How will I know what to do?

Assuming you’re not looking to take your pension benefits early, your existing provider should write to you no later than four months before your selected retirement date detailing the options available. You can then request an illustration to get an idea of what benefits you could expect if you were to buy your pension annuity with them. 

The illustration will also give you the value of the pension fund, enabling you to contact other pension annuity providers to get a comparative quote. 

Where a Final Salary scheme does not provide a pension income directly, the Trustees of the scheme may purchase an annuity on behalf of the scheme, to pay your income. 

If you are at all uncertain about what to do, we recommend that you take advantage of the free and impartial guidance service set up by the Government, called Pension Wise (www.pensionwise.co.uk) to help you make your decision. If you are then still unsure, you should speak to a financial adviser.

What happens if I change my mind?

If you apply for a Saga Pension Annuity, you have 30 days from the date you signed the application form to change your mind. After the 30 days have passed, you won't be able to cancel or change your annuity payments.

What is an enhanced annuity?

An enhanced annuity is a pension annuity benefitting from improved annuity rates and therefore offering a larger pension income. If you have, or have had, certain lifestyle health risks then you may qualify for extra income.

Different annuity providers have different qualifying criteria for their enhanced annuities, so you should get quotes from as many providers as possible. If one provider doesn't offer you an enhancement, you shouldn't assume that will be the case for all providers. Some providers may ignore lifestyle and medical factors that other providers will take into account.

What should I think about before buying a pension annuity?

Buying a pension annuity is a very important decision, because once you've bought it you can't change your mind. You therefore need to be sure that what you are buying is right for you, as you may need to rely on the income it provides you with for many years to come.

Because of the importance, we recommend that you take advantage of the free and impartial guidance service set up by the Government, called Pension Wise (www.pensionwise.co.uk). If you are then still unsure what to do, you should speak to a financial adviser.

Where will my income be paid?

Your income will normally be paid into your UK bank or building society account. You must be named as either the account holder or joint account holder. All payments will be made in British pounds sterling (GBP). 

Arrangements can be made for payments to an overseas account if requested, but there will be a charge for converting your payment from sterling to the required currency. The charge will be deducted from each payment instalment.

Will I have to pay tax on my income?

Your annuity income will be added to any other taxable income and taxed at the highest rate applicable.

Who offers the service and how are they regulated?

The Saga Annuity Service is provided by Legal & General Assurance Society Limited. Saga Personal Finance is a registered trading name of Acromas Financial Services Limited, which is registered in England and Wales (Company No. 3023493). Registered office: Enbrook Park, Sandgate, Folkestone, Kent CT20 3SE. Acromas Financial Services Limited is authorised and regulated by the Financial Conduct Authority. Legal & General Assurance Society Limited is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority.

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