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Boost your pension: take up smoking

Enhanced annuity payments.

Photograph: Getty Images

Applying for enhanced annuity is a way to increase your pension. You can get this if you are likely to die younger.

An annuity works, essentially,  as a bet with a life insurance company about how long you will live. If you die before the predicted time, the company makes a profit. The odds against your life are increased if you smoke, so you can apply for an enhanced annuity - a little more money per year.

Right now annuity rates at their lowest levels ever, but according to a survey by MGM Assurance, more than 70 per cent of those coming up to the end of their working lives are missing out on enhanced annuity payouts because they do not apply for them.

Here is a chart showing the amount of money you can get per year if your life is slightly more uncertain:

Health Male aged 65 Female aged 65

Congestive heart failure

£3,745

£3,565

Diabetes, type 1

£3,625

£3,452

Smoking (12 cigarettes/day)

£3,562

£3,406

High blood pressure and cholesterol

£3,263

£3,099

Healthy annuity

£3,068

£2,957

Gross annual income for a single life annuity, guaranteed for five years, level payments paid monthly. Source: Better Retirement Group.