Get the best Annuity (income in retirement) possible.
The topic of Annuities is riddled with jargon and consequently most women have not got a clue what it is all about! Simply put, they are financial products that are offered by most insurance companies that converts a lump sum of money into an income for life.
Make sure your pensions generate the best pension income possible.
Shop around for the best deal.
Women get such a bad deal on annuity rates (because we live longer, the pension companies have to pay us our income for longer, so they penalise us for this). So, for women it is even more vital to shop around at retirement for the best pension income -or annuity. Fewer than one in three people do this. This is a shame because it could mean up to 30% more income each year, for life. AND, it is so simple to do using the internet. You can easily compare annuity rates .
Your current pension provider is unlikely to offer you the highest retirement income. Although it can be the easiest option to accept their offer and get on with your retirement,it may cost you dearly. You could be locking yourself into a poor deal for the rest of your life! Just like your car or home insurance, it pays to shop around. Make sure you are getting value for money. This decision is for life and you only have this one chance to get it right. The difference between the top and the bottom standard annuity rates can be up to £1,000 per year. Over 20 years this could mean a difference of £20,000 in YOUR pocket!
Bad health and being a smoker can mean more income when it comes to annuities!
Declare any existing health conditions, when applying for an annuity quote. It could mean more income! This type of ‘enhanced” annuity is still a well kept secret; even though up to 40% of retirees could qualify. It is called an enhanced annuity because the income is individually priced to take into account any medical conditions you have. Standard annuities, just use average life expectancy. This is definitely one time to ensure you mention any medical conditions, past and present! It is also important to declare if you are a smoker for the same reasons. You do not have to be seriously ill to qualify for an enhanced annuity. The annuity market has changed over the last few years, so now even minor conditions such as high blood pressure and high cholesterol can result in an enhancement.
Annuities are covered by the Financial Services Compensation Scheme.This can act as a safety net should an annuity company become unable to meets its annuity obligations
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