Why would I want to shop around for an annuity?

1st June 2012

Purchasing an annuity is one of the most important steps that you will ever take when it comes to taking control of your retirement income. If your annuity income is something that really matters to you then you need to take your investments seriously and look around for the best offer on the market.

Annuities are big business and as such there are a number of different companies out on the market who are able to offer you a wide range of options. Shopping around for an annuity can save you a great deal of money in the long term as it allows you to target an annuity plan which is specifically able to deal with your individual situation.

What is the Open Market Option?

The Open Market Option was introduced to encourage competition between annuity providers and help to ensure that everyone has access to the same type of annuity rates. Before the Open Market Option was introduced, an individual would have to carry their annuity plan on with their existing pension provider, meaning they weren’t able to pick and choose between different providers.

The Open Market Option ensures that each individual is able to select between a range of different annuity providers depending on what they are looking for in an annuity plan. It means that they no longer have to stick with their original pension provider, but they can elect to remain with their existing provider if they choose.

What are some benefits of shopping around for an annuity?

Shopping around for an annuity is a great way to keep your options open and help to ensure that you get the best value for your annuity investment. With the Open Market Option in operation you are able to pick and choose between a wide range of different annuity options so it’s important to consider the choices that are available to you.

By shopping around for an annuity you can receive up to an extra 40% on your annuity income which can really add up over time and contribute significantly to your final annuity income.

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