Annuity Market Not Working

Annuity Market Not Working.

The Financial Conduct Authority (FCA) has reviewed 25 pensions firms which represent 98% of the annuity market and found that 6 out of 10 retirees stick with the same company they used to save their pension.

80% of those who stayed with the same company could have got a better deal elsewhere and some of the better deals could have increased their income quite dramatically.

On average a person’s annuity could have increased by 6.8% by shopping around. The average pension pot that was used for this review was £17,000 - this would get you an annual income of £1,030. If the person with this pot was to have shopped around their annual income could have increased by £71.

It was found that those with a much smaller pension pot were shut out by the industry.

Using a financial adviser to search the market can get you a better annuity.