A better alternative to annuities?

rrdiver

Having had medical problems, the idea of investing in an annuity (even an 'enhanced' one) that all goes to the insurance company if you don't live for another 20-30 years combined to the ridiculous hidden commissions (£thousands) paid to people like Hargreaves Lansdown for finding open market options, sticks in my throat. Annuities are a total rip-off and I wish I had never invested in pension policies. However, now that I am at the point of retiring, I need advice on a new range of alternatives called R.I.T.A. (Retirement Tri-investment Account) invested in the ARM Assured Income Plan. This is being offered by Rockingham Retirement and reads well as it's a bit like a drawdown pension fund - the fund doesn't die if you do! However ARM is not covered by the FSA and I'm uncertain how much protection the Americal MiFID gives to U.K. investors. Any advice or information on this new alternative to annuties would be very welcome.

dunstonh

the idea of investing in an annuity (even an 'enhanced' one) that all goes to the insurance company if you don't live for another 20-30 years combined to the ridiculous hidden commissions (£thousands) paid to people like Hargreaves Lansdown for finding open market options, sticks in my throat.

Commission on annuities is typically very low. The norm is 1%. Not many retailers run with a gross profit margin of just 1%. Plus, most of the enhanced, impaired annuity providers do not retail direct to consumer so you may have little choice. Plus, the commission has been declared for decades now.

The other thing is that annuities do not have to die with you. There are guaranteed options.

Annuities are a total rip-off and I wish I had never invested in pension policies.

Its a pain that its the major choice but when compared to everything else, nothing beats pension contributions and an annuity for provision of income in retirement.

However, now that I am at the point of retiring, I need advice on a new range of alternatives called R.I.T.A. (Retirement Tri-investment Account) invested in the ARM Assured Income Plan. This is being offered by Rockingham Retirement and reads well as it's a bit like a drawdown pension fund - the fund doesn't die if you do!

If you want high risk specialist investments why not just consider doing conventional income drawdown instead?

Any advice or information on this new alternative to annuties would be very welcome.

Rockingham do not market the product accurately and they have spammed these boards before and are not popular here. Plus, the commission on the product dwarfs that of an annuity. So, that must put you off given your comments about commission.

I suggest you go back to researching all the available options with an open mind and without bias. This is a once in a lifetime decision and its not a time to be so closed minded.

dunstonh

I have been receiving PMs from Steve Hunt, the MD of Rockingham threatening legal action if I do not remove the above post.

I cannot see anything in the post that is an issue

1 - A spam was posted to the board (which I believe the board removed but is a copy is posted in the thread below). So, that is fact. Some also considered the thread below to be a self promoting spam. That is of course an opinion.
2 - I do not believe they market the product accurately as it has been stated in a few places that it is low risk and there are no charges. Both of which are not correct and again, the thread below shows that.

Take a read of the following thread:
http://forums.moneysavingexpert.com/showthread.html?t=1247921&highlight=

For reference Steve Hunt is steve62384

Make your own mind up.

purch

The return of capital within R.I.T.A. is not guaranteed; nor is the income.

I think I'll start my own scam ..... oops sorry retirement product.

P.U.R.C.H. ( Put Ur Retirement Cash Here)

I won't guarantee your capital or your income (in fact I might spend it all next week) but it should be a nice little earner !!!

Consumerist

dunstonh wrote: »

I have been receiving PMs from Steve Hunt, the MD of Rockingham threatening legal action if I do not remove the above post.

This guy sounds a bit of a lune. On that basis alone I wouldn't touch his products with a barge pole.

Many thanks for the tip-off. I think you've done us all a favour.

Perhaps he'll threaten to sue me too. :rotfl::rotfl::rotfl:

dunstonh

I thought you may be interested to know that the FSA is now taking an interest in the marketing of these

http://www.citywire.co.uk/adviser/-/news/regulation-training-and-competence/content.aspx?ID=384261&re=8554&ea=196312

The Financial Services Authority (FSA) has warned that the marketing of traded life policies carry ‘major flaws’ and said it would be ‘very concerned’ to see the market increase rapidly.......

jh2009

I wonder what Steve Hunt would be in cockney rhyming slang?

jamesd

That's a shame because traded life policies could be quite interesting investments as part of a portfolio if all of the risks are very well described at the outset.

If it's US policies I don't know of anyone who'd describe unhedged currency risk as only small for someone who is retired and needing income in Pounds.

dunstonh

There is more info posted today on money marketing.

http://www.moneymarketing.co.uk/1007857.article?cmpid=MME01&cmptype=newsletter

So, you can see that the concern is increasing. I wonder if rockingham will threaten money marketing with legal action?

dunstonh

More updates

Rockingham Retirement has taken down its website and temporarily closed its advice arm to new business after the FSA suggested it conduct a full review of its systems and controls during a recent visit

http://www.moneymarketing.co.uk/1015137.article?cmpid=MME01&cmptype=newsletter

This was after last week when they increased the risk rating of the product

http://www.moneymarketing.co.uk/regulation/rockingham-raises-rita-risk-rating/1014845.article

dunstonh

It gets worse for Steve Hunt and Rockingham.

Their PI cover lapsed on 1st Aug 2010. So, they have no insurance to cover the cost of awards on the complaints. PI insurance covers the year a complaint is made. Not the year a product is sold.

http://www.moneymarketing.co.uk/investments/rockingham-has-had-no-pi-cover-since-august-2010/1048176.article

http://www.moneymarketing.co.uk/regulation/fsa-yet-to-be-notified-on-rockingham-liquidation/1047550.article

and for those that arent aware of the subject but like a good read and a bit of a laugh. Here is the main thread on the subject: http://forums.moneysavingexpert.com/showthread.html?t=1247921&highlight=

BTW, the company that happens to review SERPS and keeps reporting my posts to the board to get them removed should take note of what has happened to companies that cross swords with me. Cartel was another that threatened me with action and they went bust too.