Many industry experts are anticipating that sales of pension annuity products as we know them are going to decline. There is a prediction that the compulsion to take an annuity at age 75 will be scrapped by 2013 as people fail to save enough for retirement to make an annuity worthwhile.
A general lack of pension provision scuppers the pervading argument that offer a secure income in retirement.
There is an argument that annuities offer a secure income in retirement but a lot of people say they can’t afford to save enough into their pension pot so that the income levels offered to them are below a secure level anyway. In other words, the pension pot is not big enough to buy a meaningful pension annuity for a retirement income.
There has also been a change in industry sentiment towards the age 75 rule because it has made the process of developing new pension products more difficult. However, a change in sentiment doesn’t actually mean that there will be big changes in the pension annuity industry.
