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Open Market Option Is Absolutely Essential To Get The Best Annuity Rates
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Posted On :
Jan-23-2011
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Article Word Count :
534
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Finding the best annuity means using the open market option and researching the entire annuities market. Some annuity providers do not market their products directly to the general public and because of this retirees should seek the help and assistance of a financial adviser. A financial adviser will have access to the entire annuity product range from the whole market and will advise you on the best annuities.
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As you approach retirement you need to consider your retirement income options and think about your annuity purchase. The first thing to remember about annuity purchase is that you do not have to buy your annuity from the pension company that you saved with. There is an option that was introduced to ensure you get good value from your savings and this is called the open market option.
Retirement is not just about securing your income for this year or even just next year it is about ensuring that you have enough income for the rest of your life. Annuities are often called lifetime annuities simply because they last for your lifetime. As well as considering yourself of course you need to consider those that depend on you for income, such as your spouse or partner. If you were to die early and unexpectedly would they be able to cope financially?
Lifetime annuities can be purchased with many different options and each has a place in retirement planning, however, each also does cost an amount of starting income. As they say there is no such thing as a free lunch, the same is true with annuity purchase. Each option you choose to protect yourself and those that depend on you will lower the amount of income that your pension starts at. Now of course this is why the open market option is essential when you come to purchase your annuity.
The open market option allows you to take your pension fund and the shape of the annuity you wish to purchase to the open market to find an annuity provider that will give you the most income for the accumulated pension fund you have. This is very powerful option and should not be disregarded lightly. The difference between providers that provide the highest and lowest rates can be as high as twenty percent.
One of the concerns people have when they come to purchase an annuity is the fact they think that their health and lifestyle habits will mean they get a smaller annuity. This could not be further from the truth as there are a handful of providers that will actually give them more if they are in poor health or they have lifestyle habits such as smoking or excess alcohol drinking. The difference in these annuity rates can be as high as forty percent more than the standard rates. This is the one time of your life when you should declare your complete medical history as it can only be of benefit to you.
When retirees receive the wake up pack from their pension providers they should immediately start taking action on looking for the best annuities by contacting a financial adviser. A financial adviser will have access to annuity providers that are not marketing their products direct to consumers. As it happens it is these providers that do not market direct to the public that will often offer the highest annuity rates which is ironic really. The earlier you start looking the easier it will be for the financial adviser to submit your medical history and find the rates for you.
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Article Source :
http://www.articleseen.com/Article_Open Market Option Is Absolutely Essential To Get The Best Annuity Rates_49625.aspx
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Author Resource :
Using the open market option and the help of a specialist financial adviser will ensure you find the best annuity rates.
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Keywords :
finance, retirement, financial planning, health, wealth, insurance,
Category :
Finance
:
Finance
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