Nearly one million workers aged 55 and over are considering annuities for retirement for the first time as their value soars against the backdrop of the increased cost of living[i].
Punter Southall Aspire Chief Executive Steve Butler welcomed Legal and General’s research but sounded a note of caution, warning people not to be carried away by headline figures before handing over their pension in exchange for what can be a guaranteed income.
Steve said: “Annuities have risen significantly and this is sensibly being reflected in greater interest from more people planning for life after work. Although rates have jumped enormously there is still a huge disparity between the value of annuities on offer.
“Shop around like you would for car insurance but it’s a bit different. You can always buy another motor policy once your deal comes to an end. Once you buy an annuity, there’s no going back. It’s a once-in-a-lifetime decision, not every couple of years. Make sure you have all the facts at your fingertips.
“Employers can play their part because employees look to them. Providing tailored guidance and online tools could prevent staff making a costly mistake and put them on the right path to making informed decisions about later life income.”
This research follows Canada Life’s which last year revealed average benchmark annuity rates1 were up by 44 per cent since January 2022, having reached a 14-year high in October.
Punter Southall Aspire’s Pension Potential is free to employers and free to use for staff. It can be added to employee benefits packages and platforms to help employees understand and compare EVERY annuity on the market.
Punter Southall Aspire also offers Aspire to Retire for companies to support employees planning for life after work.
[i] https://www.professionaladviser.com/news/4062388/annuities-vogue-million-pre-retirees-considering
