Making your own mind up about Annuities

As you probably know by now one of the major changes the chancellor made this week was that retirees would no longer be forced to buy an annuity with their pension fund.  It is expected that anyone over the age of 55 who belongs to a private pension scheme (as opposed to a final salary scheme) will be able to take out their savings as a lump sum to spend or invest as they like. Meaning that rom 2015, people reaching retirement age will be able to spend the money however they want, rather than having to use it to buy a guaranteed income.

Mr Osborne dismissed concerns that retired people will spend all their pension at once and end up relying on the state. "It's all part of a coherent pension reform," he told BBC Radio 4's Today programme. "So we have a more generous basic state pension, less means-testing and that enables us to get rid of a quite old fashioned set of government requirements, put in place many decades ago, that people had to take out annuities. "While annuities might be right for many people, they are not right for many, and returns from annuities have been much lower over the last 15 years or so.
"In the end, people who have saved through their lives, who have earned that money, I think should be trusted to make their own decisions, with good advice, about what to do with that money in retirement.” Enables’ IFA’s in Bishops Stortford would be happy to help you consider your options for retirement.

Issued by: Enable Independent Financial Life Planners
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