Annuity Calculator
An annuity is an income for life which can be bought with a lump sum of capital. An annuity is a guaranteed stream of income provided by an authorised insurance company or Friendly Society in exchange for a lump sum investment. The annuitised income is payable throughout the life of the policyholder. The annuity industry is about the pooling and transferring of risk from the annuitant to the provider. If you die early, the Life Office receives a windfall, since the annuity is extinguished- unless you have included spouse's benefits. When you buy an annuity, you purchase an income which is predictable, but for an unpredictable period of time.The most common way to draw benefits from a pension fund is to the maximum tax-free lump sutake m and use the balance of the fund to buy an annuity. Where the fund used to purchase an annuity originates from a pension scheme, a compulsory purchase annuity (CPA) must be bought. Compulsory Purchase Annuities can be paid at any age from 50 onwards regardless of whether the individual has physically retired from work.If an annuity is bought with a lump sum from other sources (including the tax-free cash element of the pension fund) the annuity is known as a Purchased Life Annuity (PLA).With the dramatic changes to life expectancy, and the consequent reductions to mortality tables, combined with the prognosis that long term gilt yields, upon which annuity rates depend, will remain low has meant an on-going and significant reduction in annuity rates. In 1901, males had an average life expectancy of 45 and females could expect to live to age 49, on average. In 2006, the life expectancy at birth for females was 81 years and 77 for males.
I understand! but there is a formula where we can calculate several things about annuities rate. Do you know about that calculator?
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