A recent report suggest that major insurers are cashing in at the expense of 150,000 people each year who fail to shop around when they buy an annuity, according to a damning report by the City regulator. On average, 80 per cent of people choose to buy an annuity from the same company that runs their pension fund but the report suggest that pensioner could get 7 per cent more income if they shopped around on the open market. In some cases they could get 20 per cent more.
The FCA report found that 150,000 people retire each year on lower-paying annuities. Most likely to lose out are those with small pension pots worth less than £5,000. These savers are offered lower rates than those with larger funds, have less choice of providers and are not always aware that they could potentially take their pension as a lump sum under 'trivial commutation' rules. The significant findings from a year-long study by the Financial Conduct Authority confirms long-held suspicions about annuities and the regulator will now launch another probe to discover whether insurers have misled their pension customers when selling them annuities.
Issued by: Enable Independent Financial Life Planners
25c North Street, Bishops Stortford, Herts CM23 2LD
Telephone: 01279 755950 - Fax: 01279 657339
Enable Independent Financial Life Planners is a trading style of Enable Independent Limited is authorised and regulated by the Financial Conduct Authority.
It is important always to seek independent financial advice before making any decision regarding your finances. If you would like any assistance, please contact us.
NOTHING CONTAINED IN THE ARTICLES SHOULD BE CONSIDERED AS GIVING INDIVIDUAL FINANCIAL ADVICE
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