Last year, consumers lost £130 million by sticking with the same pension provider. George Square Financial Management explain why shopping around for a better annuity can help you ensure you don’t miss out in retirement.
New research has revealed that around 30,000 people who took out an annuity with their current pension provider missed out on an average of £4,000 over the course of their retirement. This may come as a blow to people expecting their retirement income to cover more than just the essentials.
Buying an annuity
Buying an annuity is a way of turning all your pension savings that you’ve built up over the years into an income that will last you for the rest of your life. Since April 2015, you’ve been able to withdraw as much of the money as you want when you reach age 55, although bear in mind that above 25% will be taxed as income.
Over half of the people that took part in the research want their pension to cover more than just the basics – they also want it to cover home maintenance costs, holidays and future care costs as well as having enough to leave behind as inheritance.
It is therefore essential to shop around for the best annuity rate to make your money stretch further and ensure you’re not missing out on a boost to your income. Arranging an annuity, however, is a complicated process, so it’s important to know what you need to do at each stage.
Seek professional advice
Taking professional financial advice is the best way to ensure that your retirement fund will meet all of your needs. Nine in ten people who took financial advice feel confident they made the right decision with their money.
With people expecting their pension pots to stretch even further, it’s crucial to take control and get support to make the most of your savings.
Choose the option that’s right for you
If you’re unsure about your retirement options or would like help to get a better deal on an annuity, our specialist pension advisers can help.
Call 0115 947 5545 for a free initial consultation.
We look forward to hearing from you.