In a sense, an annuity works as Life Insurance in reverse. It is the Insurance company that will sell you the annuity that will estimate how long you will live and they then use this as a basis for the amount it will pay you. Everyone who has taken a pension and has saved a lump sum with their pensions provider must buy an “Annuity” by the time they reach 75 years of age.
There are certain exceptions and those are people who are part of a workplace final salary scheme, however these schemes are becoming less common, so most people are currently faced with the annuity option.
It is a common occurrence that often people are in poorer health when they take their pension than ever before. It does mean that certain annuity providers will offer a enhanced annuity which will boost the income you could receive. This is where our independent advice and unbiased research will benefit you.
It is not mandatory to accept the annuity rate from existing pensions company. Annuity offered varies from company to company so we always aim to advise you on the best annuity rates available.
Simply switching your annuity rate could boost your pension by hundreds of pounds a year (an extra week in France on holiday for example) or by switching Annuity plans you could find a rate that better suits your needs. Contact us via the website to see how we can advise and help !