Life annuity is your security
A life annuity gives you an income monthly for the rest of your life. And you can easily ensure that your family receives your pension benefits. Therefore the life annuity is a great safety.
Previously, many have linked a life annuity to a lottery ticket, in which you can only win if you live longer than others. However, this is no longer the case. If you have a life annuity, you can secure your family financially. A life annuity scheme therefore has a major advantage – and it ensures that you never run out of money.
People living in Denmark who stop working today typically look forward to 25-30 years of retirement. Years where they can do what they have dreamt of and want to do. This is where the life annuity comes in the picture. Together with the state retirement pension, it helps ensure that you get paid out all your life.
Why are some people still sceptical?
Some people in Denmark are still sceptical about the life annuity pension. This is partly due to an old myth that the money disappears into the pension company if you die early. This is not the case anymore.
Should you be unfortunate enough to die before retirement age, your entire pension savings will be paid out to your survivors. And if you want to secure your money after you start paying out your pension, you also have the option of doing so. However, you don't have to think about this right away.
Who is to receive your pension benefits?
You need to decide whether you want to secure your survivors when you plan how you want to have you pension paid out. We want to help you with that at a meeting about six months before you want to retire. You have several options:
- You can secure yourself so that you get your pension paid out for the rest of your life.
- You can provide cover for your beneficiaries for a period of approximately 17 years after your death.
- You can ensure that your spouse/registered partner receives your payments for the duration of his or her life.
A good idea to have a combination of pensions
If you are able to do so, it may be an advantage to combine your life annuity with an annuity pension and a retirement savings scheme.
This gives you the option to spend your life annuity to cover your fixed expenses and supplement this with an amount from your annuity pension and your retirement savings for all the fun things such as travelling, going to the theatre or your hobby.
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