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Sorting your Annuity, you might have to act quickly

If you are a man and aged 55 or more and planning to retire in the near future you need to get your skates on before new rules to be implemented in December could mean you receive less retirement income from your pension savings.

Men have on average received about 4% more income from their annuities than women, because women tend to live longer. But the EU gender directive, which comes into force on 21 December, will stop insurance companies using the sex of a pension policyholder to determine the income the policyholder receives when they cash in their savings and buy an annuity. Insurers have said they will rely more heavily on other criteria, to underwrite annuities, including the type of work a policyholder has done and whether they suffer certain medical conditions.

For men, the move means a sharp drop in annuity rates, building on a gradual decline over the past few years.  This means that men planning to draw their retirement income in the near future should consider bringing their plans forward to take advantage of differential rates. “Ideally, they should ask for a quote now, then repeat that process every 14 days,” he says. “If they see the rate they are offered beginning to fall, it’s a sign they should act very quickly to buy their annuity.”

It is still best not to rush into anything before checking, IFA Enable can help you make sure you are doing what is best for the whole of your retirement portfolio.

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