If you are about to retire, or are at least at the stage when you are beginning to think about retiring, then you will quickly realise that you need to do everything in your power to make the most out of your pension. In most cases people have saved since their first job, and now that retirement is looming, there is a worry that what has been saved will not be enough. This is a common worry and for some, the answer to this quandary will be enhanced annuities.

With annuity rates at an all-time low, it is well worth investigating the possibility of effecting an enhanced annuity plan. This is a particular kind of annuity which offers a larger annuity for people with medical conditions that could limit their life span. As many as 70% of people are missing out on a higher annuity just because they don’t think about applying for enhanced annuities, and they work in the same way as a normal annuity.

Enhanced annuities and annuities in general might seem difficult to understand but really they are a bit of a gamble between you and the annuity provider, about how long you can live. When you decide to buy an annuity, enhanced annuities or otherwise, you use the lump sum of your pension in exchange for a regular and guaranteed income that you will receive for the rest of your life. The annuity is calculated on how long the annuity provider expects you to live, and this is why with an enhanced annuity you can receive a larger income.

So, how will you know if you are eligible for an enhanced annuity? If you are a smoker, or take regular prescription medication or have been hospitalised recently, then you should certainly apply for enhanced annuities. The sum you will receive will be determined by the current state of your health and how you live. Should you be overweight, have high cholesterol, or blood pressure then you can also receive about 7% more income than a healthy person.

There are a number of variables and it will be up to you to find out about them and then apply for enhanced annuities; if in fact, this is what you decide to do. Enhanced annuities can be extremely useful in getting you through the difficult patches, and so it is wise to take advantage of what is available as much as possible.