Will the proposed ‘blanket rule change’ for the age limit for when annuities have to be purchased really help solve the real issues affecting UK retirees?
One insurance company, Skandia, recently called for a permanent end to forced annuitisation at age 75, on the back of Conservative party pressure on the Government to temporarily suspend the rule whilst we witness the current stockmarket turmoil around the world. However, another company, a leading enhanced annuity provider, MGM Advantage, says a debate over temporary abolition of the rule won’t really help.
Craig Fazzini-Jones, of MGM Advantage, says people’s main concern is about the drop in value of their pension funds, resulting in reduced annuity income for those about to retire.
The average pensioner is not in a position to wait until they get to the age of 75 to start receiving an annuity income, although some reaching age 75 may prefer to wait.
Annuities are the right option for many retirees in rocky stockmarket conditions as they offer a guaranteed income for the rest of the retirees’ lives. On top of this, annuity rates are the highest they have been for years, especially when shopping around for the best annuity rates is taken into account.
The difference between the best and the worst annuity rates can be as much as 12%, while it can be around 40% for someone with severely impaired health.
Retirees could regain some of the annuity income lost as a result in the drop of the values of their pension funds by shopping around for the right annuity. Policyholders should be educated about the open market option that applies to their pension policies, as an estimated two thirds lose out by not getting the best annuity rates.
I’m 90 years old and in very good physical condition. I would like to buy an annuity for $100,000 but my bank told me that I was too old. Isn’t this age discrimination under Federal Law. Annuities ,especially those originating in NYS are a very safe investment because if an annuity company were to fail,the money would be backed by an insurance fund. I don’t like to be told that I can not invest in something because of my age which violates my constitutional rights. I intend seeking legal representaion in this matter. I would appreciate your opinion.