The right plan for you at retirement

At Standard Life, we believe retirement brings something new and exciting to your life. It’s a period of transition where you can pursue different opportunities and interests on your terms. We call it your Second Life. 

Choosing the right retirement income plan for you, will give you confidence, flexibility and accessibility to live the best second life you deserve.

 

Your income in retirement - the fixed or flexible approach?

Income in retirement can take two forms: Fixed and Flexible. You can use your pension savings to opt for one, the other, or a blend of both. Combining fixed and flexible income offers the best of both worlds—reliable payments to cover your everyday essentials, and the freedom to shape your lifestyle and pursue your goals throughout retirement. 

An Annuity can be used to provide in retirement and there are two different products that can be used to provide a flexible income, a flexible income, the Personal Retirement Savings Account (PRSA), which after retirement is often called a Vested PRSA and the Approved Retirement Fund (ARF). Both are similar in structure and have flexibility at drawdown.

When considering retirement income options, it's important to understand how each works, and how you might be taxed, so you can make the most of your second life. 

 

Fixed and flexible income in retirement

  • Fixed income

    You can use some or all of your pension savings to purchase an annuity. This gives you a guaranteed income for the rest of your life. This retirement income strategy may suit if you want the certainty of a secure, regular income to meet your financial needs.

    Your annuity choice impacts your income. For example, opting to support your spouse or civil partner after your death means receiving less income during your lifetime.

  • Flexible income

    You can use part or all of your pension savings to invest in an Approved Retirement Fund (ARF) or Personal Retirement Savings Account (PRSA). If you’ve saved for retirement using a PRSA you can simply remain invested after you take your tax-free cash, with the remaining fund providing your income in retirement. Or if you saved for retirement using a different product you may be able to transfer your remaining fund to a PRSA after you’ve taken your tax-free lump sum.  This is known as a Vested PRSA.   
      
    Both an ARF and PRSA give you the potential to grow your retirement fund while drawing a regular income from it. Their key advantage is flexibility – your financial needs may change over time, and with a Vested PRSA or ARF you can adjust your income and make withdrawals where necessary.

Retirement income options compared

Fixed (Annuity)

  • Provides a guaranteed retirement income for life
     
  • You can opt for your income to increase automatically annually
     
  • Your retirement savings are converted into a lifelong income stream, with no additional investment returns
  • Your income is paid until you die and can be extended if you have chosen a guaranteed period or added coverage for a spouse or civil partner

Flexible (ARF or PRSA)

  • The ability to make your own investment decisions with your remaining pension fund
  • Subject to legislation, you have the flexibility to adjust your income to suit your needs
  • Any remaining funds go to your estate when you die
     
  • The value can rise or fall, depending on investment performance and there’s a risk your fund may run out during your lifetime
     

  • Annuity

    You can buy an annuity, which gives you a guaranteed income for life, with the funds you've saved in your pension. The amount you get is based on factors like age, gender and how much you've saved as well as the options you've chosen.

  • Synergy Approved Retirement Fund (ARF)

    With an ARF you can enjoy your retirement income while keeping your retirement fund invested, it’s flexible. You can choose where to invest and subject to some rules, adjust the amount you withdraw each year to help you live your best second life.

     

  • Synergy PRSA

    A simple and flexible ‘whole of life’ retirement solution. You can save for retirement with a wide range of investment options and enjoy the comfort of knowing you can adjust contributions to fit your needs. When you retire and take your lump sum, your remaining PRSA can be invested with the potential for growth while providing your income in retirement.

Retirement income and pensions FAQs

Still have questions? Visit our pension FAQs page to find some of the answers, and remember we're always here to help.

My Standard Life: enhancing your online experience

Access your policy information with ease and contact us securely online with the new Secure Message feature.

Warning: The value of your PRSA/Approved Retirement Fund investment may go down as well as up

Warning: Your PRSA/Approved Retirement Fund invest may be affected by changes in currency exchange rates

Warning: If you invest in a PRSA/Approved Retirement Fund you may lose some, or all, of the money you invest

Warning: The income you earn from your Vested PRSA/Approved Retirement Fund investment may go down as well as up. 

Warning: If you invest in a PRSA you will not have any access to your money until you retire

Share via

Looking for more information?

  • What are my retirement income options?

    Understanding the ways you can take your retirement income. Which is right for you? 

  • Your retirement options

    You have a number of options when it's time to take your pension benefits. As well as talking to a financial advisor, this page will help you understand the available choices.