Use An Annuity Broker To Compare The Market For The Best Annuity Rates

Buying an annuity is something most people don’t think about until they reach retirement age. Once they do decide they are intending to purchase an annuity, most end up buying the annuity from the company with which they have been building up their pension with. This can be a costly mistake as your current pension provider is unlikely to have the highest rates on the market. Also not all providers offer the same annuity products, which means you will never know who has the best deal to suit your circumstances unless you shop around for the best rates.

Shopping for an annuity can be done in a number of different ways. You could in theory speak to each provider individually, although this would be extremely time consuming and indeed counter intuitive unless you are a pension guru yourself. The best way to compare the market for the best rates is to speak to an annuities broker. They will be able find out what your needs in retirement are and how best they can be met given your own financial situation. They will also be able to compare providers to help you find the best rates.

As mentioned previously not all annuity providers offer the same products with many companies simply providing standard, level annuities. These do not take into account a person’s health or the fact that they might want to increase their income in the future to protect against inflation. Those who have health conditions that shorten life expectancy could be missing out on extra income by not shopping around for the best deal. It is estimated that as many as 70% of all annuitants could be eligible for enhancements on their annuities. However because most retirees buy their annuity without comparing the market only 10% of all annuities purchased come with enhancements. This is course suits the providers as they are not obliged to offer any advice and also can make money by selling a poor value annuity.

If you want to avoid losing out on a potentially higher income in retirement then make sure you speak to an annuity specialist or independent financial advisor. The issue with annuities is that one you buy one that’s it, you can’t change it, swap it, or alter it…..you are stuck. Unlike with car or home insurance that can be swapped annually depending on who has the best deals, an annuity is for life. Your provider will offer some information about shopping around the market but it is not as yet the default position.