Can the income from my Secure Retirement Income (SRI) investment increase over time?Tue Sep 01 14:48:00 BST 2015
Inflation means the things we buy tend to get more expensive over time, so we have added something we call our monthiversary feature to SRI as a way giving your income the ability to increase in the early years of your investment.
Here’s how it works. At the review date of your SRI investment, we look back to see what the fund value was on the SRI review date anniversary and each of the corresponding monthly anniversaries – we call these dates the monthiversaries.
We take the highest monthiversary value and, if it's higher than your previous income base, we use it to create your new income base value. Remember, we multiply you income base with your age-related income rate when we work out how much secure income you're entitled to.
This gives you 12 opportunities – every year you have your investment – to lock-in investment growth.
When we lock-in a new income base it won’t go down in the future unless you switch out of your SRI investment – but it could go up again. Every year on the review date anniversary we review your income base, so you could lock-in a higher income base year on year.
However, please bear in mind that income payments and charges will reduce the value of your savings over time. Changes to your fund value will also affect how much your savings are worth. These factors in combination mean that the monthiversary feature is likely to only increase your income base in the early years of your investment.
For an example of how income increases work, please go to page four of our leaflet What is Secure Retirement Income?(Opens new window)