The Daily Express front page yesterday (19/11/12) led with the headline “Millions due a bigger pension”.
The Express was reporting on the latest research from the National Association of Pension Funds (NAPF), whose research found that nearly 500,000 retirees (almost two thirds) are being short changed by as much as £1 billion, because they don’t shop around for the best annuity deal on retirement.
The NAPF estimates that six out of 10 retirees could qualify for an enhanced annuity which would typically increase their pension by 15% to 20%. Anything that could shorten a persons life could mean that they qualify for an enhanced annuity, including factors like high blood pressure, smoking, daibetes, being overweight, or even living in an area with high mortality rates.
The Express reminded its readers that “Picking an annuity is a one off event and cannot be un-done, so savers need to get it right first time”. The only way to ensure you are getting the best possible deal on your annuity is to talk to an independent financial adviser before you take the offer made by your pension provider. Currently pension providers are under no oblligation to tell you what the the best rates avialble might be.
It’s particularily important to shop around and get advice at the moment becuase annuity rates have been falling sharly, as a result of low interest rates, inflation and quantative easing measures, as well as longer life expectancy.
Martin Lewis from MoneySavingExpert said that “right across the board we need to shriek from the rooftops that an annuity is the biggest single financial transaction we make – because once we do we’re stuck with it”
Have a look at the information in my website about Annuities and do not hestitate to contact me to discuss your plans.
