As a nation we are well accustomed to shopping around for the best deal, especially on so-called big ticket items such as cars, houses, holidays as well as financial products such as loans and car insurance. The credit crunch has only worked to increase the amount us Brits shop around for the best deal. Whole industries have sprung up comparing products and services.However one area that has not seen people shopping around is when its comes to finding a pension annuity. Experts say that only around 37% of people bother searching other pension providers. Given that you can significantly increase your pension income by doing this, it is quite remarkable.
Lack of awareness of what is on offer from other providers or even knowing that you can consult other providers seem to lay at the heart of the problem. Another point is that in 2008, 88% of annuities were purchased using funds of less than £50,000. Many people wrongly assume because their pension pot is less than this figure it does not need to be examined by a financial adviser.
People with medical conditions that impact on their life expectancy are the ones who are losing out the most, as instead of choosing a standard lifetime annuity, they would be better of with an enhanced annuity or impaired life annuity.
Experts in the pension industry are urging the government to make changes to the information offered to retirees, because under the current system thousands of pensioners are literally missing out on thousands of pounds of additional income because they are unaware of the options available to them.
In response to this situation, the Pensions Income Choice Association has been created which proposes changes to the information that is sent to retirees, including a persononal statement which allows them to get multiple annuity quotes. They also want to help those with small pension pots by introducing a register of financial advisers who can give advice to annuitants with pots of less than £50,000.
You can support thier petition by clicking here..
Related posts:
- Retirees could lose over 50% of their income by not using the Open Market Option (OMO)
- The Open Market Option Review Group
- Boost your annuity with the Open Market Option (OMO)
- Open Market Option (OMO) more vital than the earnings/pensions link
- Open Market Option annuitants 50 times as likely to gain enhanced rates, Say ABI
