Annuity Process

The following is a detailed breakdown of the actions you can expect from your current pension company as you approach your anticipated retirement date and buy an annuity.

Annuity buying process

4 to 6 months before your expected retirement date you will be sent what’s called a wake-up letter advising you of the impending retirement. You also receive general information, along with a deferral form which allows you to postpone buying your annuity, if you so wish.

This comes from the company holding your pension fund, and they will provide you with the appropriate information. At this stage you don’t need to do anything unless you are considering delaying buying an annuity.

However, your current pension provider isn’t likely to provide you with the best retirement income. It is in your best interests to take responsibility at this early stage to find yourself the right annuity, with the right options, and the right rates. It is at this stage that you start looking around to see what else is available. Early planning will bring the best results.

6 to 8 weeks before your expected retirement you will be sent initial annuity quotes along with details of payment options. You will have a form to complete to indicate your preferred option.

2 to 3 weeks before your expected retirement you will receive a guaranteed quotation from your current pension provider. At this stage you are to return a form, committing to your selected option.

Your current pension provider, if you stick with them, will begin the process of converting your pension fund into an annuity – your retirement income.

Best annuity rate

This process applies if you take your annuity from your current pension provider, which may not result in the best deal for you. It is in your best interests to take responsibility for finding yourself the best annuity rate at the earliest opportunity. It is likely that your current pension provider will not offer you the best annuity rate and you will find a better deal elsewhere.

To obtain your free, no obligation annuity quotes you can enquire online, or call us free on 0800 0124 374. One quick free phone call from you can make all the difference. We’re here Monday to Friday, 9 am to 6 pm.