When my personal pention matures, can i purchase an annuity from a european country for better returns?
I am resident in the UK so by doing this will it give better returns with the same returns, and security of capital. Would I also be able to buy from non European countries again with the security etc.
Answers:
You may be able to purchase an annuity offshore. Perhaps in IOM or the Channel Islands. Ireland is an interesting place to look for annuities payable in Euros if this is what your angle is.
Pensions legislation is UK specific. You are required to purchase an annuity with at least 75% of the pension fund under current legislation. You can buy what you like with the other 25% tax free lump sum.
You are allowed to obtain quotes from any provider of annuities. As we are part of the European Union, and cross border sales of insurance products become normal, I would expect that if you cannot do what you are asking now then you will find that you can in a few years time. (perhaps after a general election).
There may appear to be better returns, but there will also be currency risk. In other words you will be buying a currency gamble as you are resident where annuities are paid in sterling and not Euros.
You will be better off staying with a Uk based company, this is because you have far greater protection for your fund through the Financial Services Authority. I'm not even sure you would be able to purchase outside of the UK to begin with. You would also lose out on any exchange deals changing the returns back to £'s sterling. Many other EU countries do not have stable enough economies to give any form of guaranteed return, for best advice go to an IFA,independant financial advisor
If you buy your annuity in Euroland it will be paid in euros. But as the UK economy is doing better than that of the EU, you can expect that the euro will be depreciating against the sterling and you will be gradually losing any initial advantage you had.
You had better stay with sterling, the retirement period is not one for taking chances.
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Answers:
You may be able to purchase an annuity offshore. Perhaps in IOM or the Channel Islands. Ireland is an interesting place to look for annuities payable in Euros if this is what your angle is.
Pensions legislation is UK specific. You are required to purchase an annuity with at least 75% of the pension fund under current legislation. You can buy what you like with the other 25% tax free lump sum.
You are allowed to obtain quotes from any provider of annuities. As we are part of the European Union, and cross border sales of insurance products become normal, I would expect that if you cannot do what you are asking now then you will find that you can in a few years time. (perhaps after a general election).
There may appear to be better returns, but there will also be currency risk. In other words you will be buying a currency gamble as you are resident where annuities are paid in sterling and not Euros.
You will be better off staying with a Uk based company, this is because you have far greater protection for your fund through the Financial Services Authority. I'm not even sure you would be able to purchase outside of the UK to begin with. You would also lose out on any exchange deals changing the returns back to £'s sterling. Many other EU countries do not have stable enough economies to give any form of guaranteed return, for best advice go to an IFA,independant financial advisor
If you buy your annuity in Euroland it will be paid in euros. But as the UK economy is doing better than that of the EU, you can expect that the euro will be depreciating against the sterling and you will be gradually losing any initial advantage you had.
You had better stay with sterling, the retirement period is not one for taking chances.
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