Avoid Losing Out on Your Pension

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By AdFeatures | Friday, November 16, 2012, 06:21

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It is important for people to save up for the autumn of life! Regardless of how much or how little they earn, many want to ensure they have something to live on when the time comes for them to leave the workforce. However, there is growing awareness of the possibility that the rates offered for workplace pensions, savings accounts and most pressingly of all, annuities may not be so favourable.

News that a large number of annuitants may not be getting the most from their money is proof of that.

Many of the 500,000 people who purchase annuities each year do so because they are guaranteed an annual payment depending on how much money they have put into their pension pot over the years.

However, according to results from a survey by Key Retirement Solutions, an equity release advice firm, those who do not shop around for the best possible annuity are in jeopardy of losing as much as £248/pa each from their savings.

Although, with the help of price comparison websites, finding the best annuity deal has been made much easier in recent years, the fact that thousands, if not millions of people with annuities fail to do this speaks volumes. Despite these revelations, there are other factors involved which have led to the circumstance where we see annuity holders pulling the shorter straw on their annuity saving investments, such as falling annuity rates.

The survey also highlighted the fact that we could see an increase of many as 850,000 annuitants within the near future, in line with the increase in the aging population in the UK.

People who worry about their future and whether they will have enough money to retire should look at their options on all accounts. Workplace pensions are one of the most common forms of pension on the market, but it is important to note that they might not always offer greatest value, but you will find the same problem when assessing private pension schemes. A lack of awareness of the different types of pension schemes available is also another disadvantage which has led to the paramount losses.

Online annuity experts, Mypensionexpert.co.uk, believe annuities, despite the fact that some have been affected by the falling rates, should be the forefront of our minds when saving up for our retirement.

Likewise, some of the people who sought advice in the past have also found income drawdown to be a feasible option as well. This particular route is useful for anyone who have a higher than average amount in their pension pot. However, those with less money are advised to take out an annuity, as, with shopping around for a good deal, it is possible to get a good rate while also receiving regular income for retirement. Annuities are ideal for pensioners who want to make sure they have enough money each year to at least pay for the essentials, but without shopping around, holders run the risk of getting less than expected.

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