Are there differences between annuity providers?
When it comes to purchasing an annuity it can be one of the most important decisions that you make and therefore it is one that you should not take lightly. As an annuity income could cover roughly 30 years of your life or more, the decision to invest in an annuity can have long term consequences, so it’s important that you take the time to make sure that you are getting the best deal for your money.
There are a range of different options available to people who are looking to invest in an annuity and these packages can be tailored to suit each individual. Annuities are big business and as such there are a wide variety of options on the market – so shopping around for an annuity can really save you money in the long run.
What is the Open Market Option?
The Open Market Option was introduced by the Government to ensure that everyone had a fair access to a range of annuities, regardless of what company their existing pension was with. This allowed people to switch from their existing pension provider across to another annuity provider without any charges or fees at their normal retirement age. It also prevented pension companies from locking customers into their annuity plans – giving them a greater chance to save money and promoting more competition within the annuities industry.
What benefits could I receive?
As annuity providers are in direct competition with each other, they are driving costs down for the consumer, hence giving you a better deal on your annuity income. The differences between annuity providers is a major benefit to the consumer as it provides a range of choices and options to purchasers and allows them to tailor a package to suit their individual needs.
Annuity rates can differ between companies and many companies tailor themselves towards a specific range of the market, finding the right market for your annuity can save you up to 30% on retirement income as opposed to picking a provider that might not be suited to your individual needs.
Many companies can work with you to help you work out what rate is best for you and in turn you can easily compare and contrast annuity providers until you find one that offers the best price for what you are looking for.