Delays in transferring pension savings into retirement income is costing pensioners up to £127 a week, it has been warned.
The Origo Options industry initiative has helped to reduce the average time it takes to transfer a pension fund into an annuity to 11 calendar days, down from the previous average of 31 days.
However, Virgin Money has calculated that a delay of just one week in transferring a pension fund of £100,000 could cost people dear.
A 65 year old man receiving an income of £6,651 from his annuity could miss out on £127, while a woman could lose out on £120.
However, with the worst offenders who drag their heels over annuity transfers taking as long as 51 days to complete the transaction, the ten week delay could cost men £1,270 and a woman £1,200. "Buying an annuity is a once-in-a-lifetime decision which pensioners have to literally live with," said Virgin Money's Grant Bather.
"The income is fixed for life and there are no second chances."When people are living longer in retirement the losses from delays really mount up.
"If you miss out on the best rates then the loss is compounded."It is vitally important that soon to be retirees shop around to find the best annuity rates across the whole of the market, rather than simply choosing the annuity on offer from their pension provider.Why not start your annuity research today? Our annuity best buy tables illustrate how the offerings from annuity providers such as MGM Advantage and Saga compare.
We've also recently teamed up with Premier Retirement Services to give you access to their online annuity planner service.
Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.
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