Question:
I have 2million from my pension fund is it possible to split this and buy a living annuity and a ten garrinteed fixed annuity for 1 million each
Answer:
Alex, According to Bruce Cameron from Personal Finance, you do not have to buy one annuity with all your retirement capital. You can split an annuity derived from the same source (for example, the proceeds from an occupational retirement fund) by up to four ways, provided one annuity has a minimum income flow of at least R150 000 a year and the initial capital value of each annuity exceeds R25 000 But you will not receive a minimum annual income of R150 000 from either if you invest R1m in both types, so you will probably not be able to split it. Your other option is to buy a living annuity now with the full amount, and to convert it to a guaranteed annuity at a later stage.
