Fixed-term income plans
There are two parts to a Fixed-Term Income Plan; a guaranteed income for a set period of time and a cash sum that is paid at the end of the policy term.
The income can be paid for any period of time from one to 20 years with no limits on the income that can be paid. However the more income that is taken, the lower the amount paid back on maturity, known as a guaranteed maturity amount (GMA). The GMA can be invested in another pension income policy, for instance annuity or drawdown (including another fixed-term income plan) or it can be paid in cash.
Fixed-term policies provide guaranteed income for a set period and the flexibility to review your options at the end of the term if your personal circumstances change. For example if your health deteriorates you may qualify for an enhanced annuity.