Today is the 10th anniversary of Steve Webb's first pension column, published on 16 February 2016 on This is Money. Watch out for a series of articles and events to celebrate this landmark all this week.

I have a question about a joint life 100 per cent annuity. Here is my quote. Total pension fund: £375,000. Payment frequency: monthly. Income payment: in arrears.

Tax-free lump sum: £25,000.00 (6.67 per cent). Guarantee period: no. Value protection: no. Annual increase: no. Pay to a spouse/dependant after death: yes 100 per cent.

I do not fully understand the guarantee option. As it is a 100 per cent joint life annuity why doesn’t it have a guarantee period as I thought it was for both of us until both our deaths?

Also what is the difference between advance or arrears?

Steve Webb replies: When you use your pension pot to secure an income for life or ‘annuity’, you have several options about the way in which you take it.

For example, it can be the same amount each year or have an annual uplift, it can make a payout to a surviving spouse or partner after your death and so on.

In your case, you have opted for what is called a ‘100 per cent joint life’ annuity.

What this means is that if you die before your named beneficiary (typically a spouse), the annuity will pay out to them in full for the rest of their life.

A different option is what is called a guarantee period.

In this case, when you take out the policy, if you were to die not long afterwards, the policy would continue to pay out for a set guaranteed period – say a minimum of five years – to your nominated beneficiary.

I can see why the way this information has been presented to you is causing confusion. As far as you are concerned, the payments are ‘guaranteed’ even if you die, so you are concerned that it says there is no ‘guarantee period’.

What is going on here is that there could, sadly, be a scenario in which both you and your spouse die not long after the policy is taken out.

In this situation, the policy would simply stop because there is no ‘guarantee period’.

If you wanted to avoid this risk you could specify that as well as your policy being on a ‘joint life’ basis, you also wanted a guaranteed minimum payout period.

If you did so, and both of you died relatively early in the life of the policy, your heirs or other beneficiaries could get a payout.

The odds of both of you dying quickly after taking out the policy are presumably quite low, so you might find that including such a guarantee in addition would not significantly reduce the regular annuity income from the policy.

On your second question, payment in arrears simply means that if the policy were to start on (say) 1 January, you would not get your first monthly payment until the end of the month.

This would be the payment for January, paid in arrears.

You can, of course, opt to have the money paid in advance (the start of the month in my example above).

You might want to do this if, for example, you no longer had a wage coming in and needed the annuity to start straight away to cover this month’s bills.

However, because you are getting the money sooner, the insurance company would probably quote you a slightly lower price if you asked for payment in advance rather than in arrears.

I am grateful to Mark Ormston of Retirement Line for helpful insights in writing this week’s column.