Getting The Highest Annuity Rates

An annuity is a life income which you buy with your pension pot. Many people in the private sector accumulate a pot of cash throughout their working life (your pension), and this is used upon retirement, to acquire an income producing investment vehicle, most commonly an annuity.

You basically exchange your lump sum to provide an income after you stop working. It is a very important financial decision. The annuity rates you receive determine the level of income you will receive in retirement so it is crucial that you get the best rates.

Here are five things you can do to ensure you get the highest annuity rates:

Getting The Highest Annuity Rates: Step 1

Never accept your first quote. This is usually the quote your current pension provider offers you for the money you have accumulated. It usually falls far short of what you should expect to receive and many people would benefit from looking elsewhere. This maximizes the chances of you getting the best value for your annuity. Settling for the first quote is a risky move and you may later regret it.

Getting The Highest Annuity Rates: Step 2

Shop around. You should ALWAYS shop around and see what’s out there before settling or anything. This is known as the open market option. Many companies offer different deals and rates – make sure you are well informed and shop around.

Getting The Highest Annuity Rates: Step 3

Compare annuity rates. This is a key part of the annuity buying process. It allows you to scour the whole market in one go. When you compare annuity rates, you can see the top providers and then investigate further to determine whether this particular company might be suitable for your annuity or not. With the increased amount of comparison sites, this free process has become far easier in recent years. There is no obligation to buy anything when comparing rates and it is a great way of discovering the highest annuity rates.

Getting The Highest Annuity Rates: Step 4

Read the small print. You need to be absolutely sure you understand the annuity before signing the paper. How long does the deal last? Is it a fixed rate for two years? The small print will help you to understand the nature of the deal. You don’t want to sign the forms only to realise that five years down the line the annuity rates fall dramatically and you are locked in to the deal.

Getting The Highest Annuity Rates: Step 5

Get professional advice. There are plenty of people on hand ready to offer advice and assistance. Make sure the advisers are well experienced and fully independent with a clear fee structure if any. You can also use internet sites to do your own research and join relevant forums to discuss things further with other people who are in or have been in a similar position. Professional advice could possibly help you to source enhanced annuity rates that could be available for even minor health concerns. An adviser will be able to discuss this in more detail with you.

Visit http://sigmaannuities.co.uk for further information.