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I am 63 and have built up 500,000 pounds in investments. I am looking for the best "safe" place for my money to provide me with an income for life!

by markomechanic 21 June 2011 |

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PS. I don't like the idea of annuities, as I like to be in control of my money as much as I can.
I already have a smallish private pension.

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MikeGG1 posted
A Pension Scheme does not necessarily mean buying an Annuity. You could open a SIPP which can be used for drawing down from rather than buying the Annuity. You would still get the 25% tax relief and 75% tax deferral.

Are you still working and if so how long do you intend to continue working?

£15,000 per issue should go into NS&I Index-Linked Certificates. They pay 0.5% over RPI without any tax liability.

The remainder would depend on whether you can go for the SIPP.

Mike
Posted on 21 June 2011 | Love 0 loves Report
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Mark Trehorn IFA posted
Depends on what you call 'safe'. SIPPs may be an option but usually carry higher charges for administration and although they can invest in 'cash only' funds these are low risk rather than 'safe'. As you say you have 'investments' I assume you are used already to accepting a degree of risk and you mean 'low risk' rather than what you have now. The only 'safe investment' is cash and this carries long term risks of inflation and institutional default. You do not say what type of investment you hold. I would go back to whoever arranged these for you and talk about how the risk profile of your portfolio can be reduced and altered to provide you an income without having to rip things up and start again. Many fund switches within providers are free and most offer a low risk, cash, or income option. (Basically they want to keep you as a customer and that suits you rather than paying new set up charges)
Posted on 22 June 2011 | Love 0 loves Report
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Mark Trehorn IFA posted
A further thought. You do not say what it is about annuities that you do not like. There have been many changes in the annuity market of late including the arrival of 'short term' annuities. Might be worth finding out more about the recent developments in this market. However, using funds, rather than annuities, would enable you to retain total control of the capital though.
Posted on 22 June 2011 | Love 0 loves Report