Annuity Options at Retirement
It is important to consider your options when you reach retirement. If you have saved for a pension you have the option of "selling" your pension to a pension provider in return for an annuity plan. It is highly advisable that you consider the open market option when retiring. By shopping around you give yourself more options and you can compare insurance company quotes in order to get the best annuity income deal for you and your partner (if applicable).
If you have a partner, you may wish to consider purchasing a joint life annuity plan to ensure your partner is cared for if you die before they do. The insurance company will provide an annuity quote that is based on both your ages and some providers will also factor in your health status.
Annuity rates are based on a number of factors including:
Your age – the older you are the higher the income you will get from outset because an annuity is effectively a bet between the insurance company and your ability to beat the odds of living longer than a average man or woman.
Your previous occupation(s) throughout life – if you have worked in dangerous conditions, for example, a coal mine or oil rig you may receive a higher rate of annuity because you are more likely to die before someone who has worked as a receptionist or in other low risk working environments.
Your health – if you are in poor health or have a serious health condition this may result in you getting a higher annuity income as the annuity company will see you as having a lower life expectancy probability.
Your sex – men generally die younger than women and because of this men receive higher rates of annuity. From December 2012 annuity providers will no longer be able to provide differential rates due to a european ruling on sex discrimination.
You should shop around to compare annuity plans to find the best quote - use our service below: