Shopping Around For Your Pension

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Getting the best retirement income from your pension fund can be difficult and confusing. With most pensions you have a right to buy your pension income from whichever company you like using the Open Market Option (OMO).

Shopping around can really pay dividends. Choosing the right company could increase your retirement income by 20% or more and once you have secured the higher rate, you have it for life. And you may be able to buy extra benefits for your spouse, or better death benefits. To give an idea of what is possible, at the bottom of the page we’ve given an example of what we achieved for a client recently

But that’s not the end of the story. There are many situations where your personal circumstances will allow you to get even better rates.

Contact us to discuss getting the best income from your pension fund.

Don’t forget that you may not have to buy an annuity right now. There are other ways to create retirement income.

Real client example 1 - Small fund:

Our client was married and had a small pension fund of only £17,678 after taking tax free cash. Both clients were in good health, were non-smokers and had a healthy lifestyle.

His existing company had offered him:

Income of £1,049.64 p.a. with no increases down the years

Income stopping on his death – nothing for his wife.

After discussing his options with him he decided that he was happy to take a pension that did not increase down the years. He was concerned about his wife’s financial security after his death and wanted the pension to continue for her if he died. He was also concerned about getting poor value if both he and his wife died soon after arranging the pension.

We managed to get him:

Pension income of £1,131 p.a. (an 8% increase). A higher income could have been obtained, but instead he bought additional death benefits.

The full income to continue for his wife until she also died (compared to none).

In case they both died soon after taking the pension income, we were also able to get a promise that the difference between the purchase price and the income paid to the date of death would be paid out on second death (compared to none).

Real client example 2 - Large fund:

Our client was married and had a large pension fund of £626,783 after taking tax free cash. Both clients were in good health, were non-smokers and had a healthy lifestyle.

His existing company had offered him:

Income of £31,684 p.a. with no increases down the years

Half of the income to continue for his wife after his death

A guarantee that at least 10 years pension payment would be paid, even if both clients died within 10 years

He too was happy to take a pension that did not increase down the years. He was also concerned about his wife’s financial security after his death, but was happy that only half should continue after his death. He was also concerned about getting poor value if both he and his wife died soon after arranging the pension.

We managed to get him:

Pension income of £36,448 p.a. (a 15% increase).

Half of the income to continue for his wife until she also died.

In case they both died soon after taking the pension income, we were also able to get a promise that the difference between the purchase price and the income paid to the date of death would be paid out on second death. The potential increase in early death benefits was up to a staggering £261,824.

Needless to say, we have very satisfied clients.

Contact us to discuss your needs further.