Pensioners should benefit from a new Annuity Window that was opened up last week as part of a new initiative. The ABI (Association of British Insurers) opened up a new annuity window that will allow consumers to be more hands-on and informed about how they can tap into their pension pot in order to buy an annuity which is a better way to make sure that income stays guaranteed for life.
According to figures that were compiled from the Money Advice Service, every year about one billion pounds in retirement income is basically tossed away simply because pensioners do not take the time to shop around and get the best deal.
MAS employee Jackie Spencer stated that for most pensioners their final investment decision is not reversible so it is very important to take some time and make sure that the right decision is reached. Spencer went on to say that the ABI’s decision to publish the specimen rates that are being offered by the members of the group makes annuities much more transparent so that consumers are able to shop around and figure out what is going to be the best deal for them.
Adviser site Unbiased.co.uk analyst Karen Barrett stated that although it is very beneficial to people to be able to look over their options, there are still some consumers that are not going to be comfortable choosing the right type of product because they will not know what to do with the information.
Spencer added that to combat this, the annuities industry needs to be better focused on recommending market advice to consumers so that they have guidance and they secure their income for the rest of their lives. In order to make the right choice for the highest income consumers need to be aware of all their options and what they mean.