It is thought thousands of people are missing out on a better retirement income because of an illogical approach to shopping around for the best deals.
While people are happy to compare prices for routine items like food and holidays, it appears that the same logic is not always applied to annuities.
A recent survey by Aviva found that, on average, UK adults will spend 42 hours a year shopping around for a holiday and 32 hours comparing prices on food and drink.
However, the money which they save on these purchases pales into insignificance when compared with the thousands of pounds extra income that they could receive over the course of a lifetime by finding the best annuity.
Yet more than 40% of those questioned said they do not spend any time comparing deals from annuity providers, a staggering amount of people given how easy it can be to shop around for the best annuity.
An online annuity planner service, such as that offered by Premier Retirement Services, is an ideal way to start a search for the best annuity deals, while our annuity best buy charts compare the annuity rates on offer from some of the leading annuity providers.
"By not shopping around for an annuity, people could miss out on extra income during their retirement, which could last thirty years or more," said Clive Bolton, 'at retirement' director for Aviva.
"It has never been easier to shop around for a pension income and the rewards gained will almost certainly outweigh the time spent doing so."
Benjamin Fry, a consumer behaviourist, said that unfortunately, for many, annuities were still 'a black-hole which they feel ill-equipped to understand or to venture into'.
"That's why some people just go with the first idea presented to them," he added.
"With clearer information, those approaching retirement may become more motivated to take control and then shop around, ultimately getting better value."
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 Any products featured may be withdrawn by their provider or changed at any time.
Moneyfacts.co.uk will, like most other websites, place cookies onto your computer’s
hard drive. This includes tracking cookies.