Annuities - don’t lose out

With the country’s financial situation not looking too bright it is vital that many people facing retirement ensure that they organise the details of their pension and annuity.

The financial advice bureau has issued a statement to say that more and more people are careless with their annuity decisions because they do not use the “Open Market Option” to scour the market for the best deals. Looking for the best deal by comparing providers could make you upto 40% better off than if you accepted your current deal.

It has also been reported that many people do not declare if they have any medical conditions when applying for their annuity. The pension companies base their annuity quotes on how long they expect you to live. They will calculate your average life expectancy, so if you are a smoker, you need to declare it as this could mean you are offered an enhanced rate.

The age you retire is also an important decision. Nowadays, people are working for longer as life expectancy has increased and this might mean a better annuity. For example, if a healthy person retires at the age of 60 with a £100,000 pension pot they could get £6,765 per annum, but if this same person retires at 70, the annuity rates could go up to around £8,500 according to various annuity providers.

All in all your annuity is an important decision and it should therefore be a well informed one. Many factors come into play but if you do your research, you should be able to find a great deal to suit you.