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How to find a good annuity

As posted in another thread, I am a 59 year old male and have two small pension pots. They are 17k & 3k.

I am going to take 25% as cash and buy an annuity with the balance.

Are there any comparison type sites where I can try to find a company to buy the annuity from that will give me the best deal ? (or are all the annuity providers more or less the same ?).
«134567

Comments

  • kidmugsy
    kidmugsy Posts: 12,709 Forumite
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    Debutante wrote: »
    are all the annuity providers more or less the same ?

    No, they're not.

    Ideally you should use an IFA, though many might baulk at only £20k. If, however, you qualify for special terms because of health problems, you might be wiser not to trust to shopping around yourself, even if an IFA's fees are rather a heavy proportion of your total.

    Are you set on an annuity, or would you like to try to get the lot out as cash?
    Free the dunston one next time too.
  • Debutante
    Debutante Posts: 50 Forumite
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    edited 14 December 2013 at 3:33PM
    Thanks Km :)
    I would ideally like to take all in cash but I cannot see how I can do it as I am only 59. Have you any ideas how it may be done ?

    Second question ;)
    I have read about income drawdown but it seems my meagre pot is too small. I have read about investment linked annuities - they sound quite interesting if we ever see any sort of real financial recovery.
  • kidmugsy
    kidmugsy Posts: 12,709 Forumite
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    Debutante wrote: »
    Thanks Km :)
    I would ideally like to take all in cash but I cannot see how I can do it as I am only 59. Have you any ideas how it may be done ?

    True, you'd need to wait for your 60th birthday. Sorry if I raised your hopes.
    Free the dunston one next time too.
  • jem16
    jem16 Posts: 19,493 Forumite
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    Debutante wrote: »
    Thanks Km :)
    I would ideally like to take all in cash but I cannot see how I can do it as I am only 59. Have you any ideas how it may be done ?

    You know from your other thread that it can't be done even when you're 60 as your total pension amount is over £18k.

    Answer has not changed I'm afraid.
  • Debutante
    Debutante Posts: 50 Forumite
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    edited 14 December 2013 at 4:53PM
    Thanks for the replies :)
    I think I will just take 25% of each as cash.
    Just want to know now how much I am likely to get penalised by moving them to one provider and getting a market linked annuity.

    Edit and also how to find a good provider. I have got some online indications and they range from £52 to £68 per month so quite a large spread !
  • patanne
    patanne Posts: 1,286 Forumite
    Have you considered taking the pension annually in arrears?
  • Debutante
    Debutante Posts: 50 Forumite
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    edited 14 December 2013 at 5:47PM
    patanne wrote: »
    Have you considered taking the pension annually in arrears?
    No, I detect there may be advantages. Have you got time to give me an outline ?

    Edit - I can see that there would be increased payments because they would have my money for longer but is it significantly more than that ?
  • dunstonh
    dunstonh Posts: 118,550 Forumite
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    Edit and also how to find a good provider. I have got some online indications and they range from £52 to £68 per month so quite a large spread !

    Get a local IFA to do it or a restricted adviser that is not restricted in annuity provision. You are below the ideal point of where an IFA will provide a big benefit but not by much. Plus, if you qualify for enhanced annuities, then the it should be worth it.
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • dunstonh wrote: »
    Get a local IFA to do it or a restricted adviser that is not restricted in annuity provision. You are below the ideal point of where an IFA will provide a big benefit but not by much. Plus, if you qualify for enhanced annuities, then the it should be worth it.
    I had been thinking of that - what sort of fees would I be looking at ?
  • dunstonh
    dunstonh Posts: 118,550 Forumite
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    Debutante wrote: »
    I had been thinking of that - what sort of fees would I be looking at ?

    Probably around £1000-£2000. However, the fee can be collected via the pension pot and the annuity then arranged on non commission basis. If you DIY it will be on commission basis. The firm you use will take around 3.5% commission. The IFA will likely be more expensive in your case but the annuity rates are likely to be higher.

    Your £20k pot is below the ideal figure for an IFA. However, if you qualify for enhanced terms then that will more than make up for it.
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
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