Are you retiring soon and looking for the best UK pension annuity rates in 2010. Many people as they approach their retirement wrongly assume that they have to buy a pension annuity from the company that has held their pension plan. This is simply not the case and can prove a costly mistake. There are very significant differences between the best and worst annuity rates. All pension providers must offer the open market option (OMO), which is effectively your right to shop around for the right annuity and the best annuity rates.
Worryingly, recent figures from the Association of British Insurers (ABI) show that around 60% of people who bought a pension annuity in 2007 did not shop around for the best UK annuity rates and bought their annuity directly from the pension plan provider they had saved with. As some of the better annuity providers do not sell directly to the public, the best way to ensure you get the right annuity is to use the services of an annuity specialist. They can research the market to find the best annuity rate for you. You will also be asked some questions to see if you qualify for higher enhanced annuity rates. If you do qualify for these then quite possibly you could see a significant uplift in the payments you get from your annuity.
You convert your hard earned pension fund into a regular income that will last as long as you live in retirement. The income is taxable and the amount that you get will depend on the size of your pension fund, the UK annuity rates on offer, your gender, age and your health, and the type of annuity that you select. More and more providers are now using your postcode to determine their annuity rates. There is research that says where you live in the UK is a deciding factor that may determine your life expectancy. Life expectancy is how the annuity provider’s work out their annuity rates, and naturally some people will live less time than the annuity provider predicts, but some will obviously live longer. You could do well out of this if you’re fortunate to live longer.