Converting ARF to Annuity

D

Dawn Brown

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If converting an ARF to Annuity mid tax-year. How is the 5% distribution calculated for the 6 month ARF period. I normally draw down once per year at year end .
I hope it's clear what I mean....
 
Thanks for all the replys.

I note Gordon's comment.

But just to further explain.

I took my 2023 distribution in Oct last (ie. the total value of the 5%). If remaining with the ARF I'd take my 5% in Oct. '24. But, if I change to an Annuity in July say... am I required by revenue to make any ARF withdrawl for the period Jan-June.
Ideally, I don't want to take anything from the ARF this year as I'd like to transfer the max value of the ARF fund to the annuity (assuming it's worth it at the time). I can take the hit with no withdrawl this year. Its not huge bucks.
 
Oh.. Something I thought of this morning while skydiving.....:)
If buying an annuity can I expect to receive, what I think is called an uplift , in the value of my investment.
 
Dawn Brown said:
I don't have the paperwork now,, but I think when the original ARF was set up from my pension fund I got an extra few grand from the ARF provider.
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Check with ARF provider - you may have to pay that back if you haven't left in the ARF for a fixed period. Certainly many funds have a sliding scale of penalties for "early" encashment; typically you have to leave money in for 5 years for zero penalty.
 
Dawn Brown said:
I don't have the paperwork now,, but I think when the original ARF was set up from my pension fund I got an extra few grand from the ARF provider.
Click to expand...

Yes some ARF products feature "allocation rates" of over 100% to start, but as @kierane says, these usually come with early exit charges for the first 3 or 5 years. Anyway, that idea of additional investment doesn't apply to annuities.
 
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kierane said:
Check with ARF provider - you may have to pay that back if you haven't left in the ARF for a fixed period. Certainly many funds have a sliding scale of penalties for "early" encashment; typically you have to leave money in for 5 years for zero penalty.
Click to expand...
That's a given. Won't be an issue when/if I convert to annuity
LDFerguson said:
Anyway, that ides of additional investment doesn't apply to annuities.
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LD to the rescue again ! thanks.
 
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