Annuity without using financial adviser

incus432

DRS1 said:

I hesitate to mention this because I am sure I will find out all the reasons I should not have used them but in case it is useful:
I bought an annuity from my personal pensions earlier this year using something called Retirement Line (they will appear if you google them).  They are just annuity brokers so you won't get them asking to do a full review.  They do get paid commission - not sure if they are high (don't tell me please).
My annuity was for life but they do do Fixed Term annuities as well.
They did need the odd prod but they got the job done.
I guess there are other annuity brokers out there who would be equally unintrusive.

Yes - we have a call booked from them tomorrow.  The contact provided lots of quotes for different options (and says better than money helper give), but not the one I actually asked for!  I shall ask the commission and perhaps see if it can be negotiated down.

FIREDreamer

ian16527 said:

I used L&G direct for a small annuity 2 years ago (£50k). I used Hargreaves Lansdown annuity comparison to sanity check and L&G came out top but it changes regularly so could be another provider top at the minute. See what an IFA can get you but also use the comparison site to give a comparison 

Yes I used Hargreaves Lansdown to buy a large annuity about a year ago. The rate was very good, Just Annuities, and Hargreaves got 0.8% commission from Just according to my documents, circa £5,000. Was happy with the annuity as Just was between 5% and 10% more than the other providers. Probably could have got better from an IFA? The rate dropped after I took it so I timed it nicely as they honoured the rate I applied for.

zagfles

incus432 said:

zagfles said:

incus432 said:

Apologies for jumping in on this old thread but I have been looking at taking out a fixed term annuity from a SIPP (120k before lump sum) for 8 years to fill a gap before state pension. Based on the useful advice here I understand an IFA can get better rates because they charge a fee to the client rather than get paid commission by the annuity provider.  

I therefore got a name from Unbiased. However this IFA told me he would have to conduct a full review of our finances and charge accordingly. Pressed he said he could give 'limited advice' on a fixed term annuity and would be paid by 3% commission paid by the insurer (ie c £2700). (I thought this was no longer alllowed?)  I told him I had understood I would pay him a fee for the service/advice and get a better 'no commission' annuity rate/ However it seems he will not do this without doing a full review.

Is this expected or will I get a more helpful response from another IFA (i have now tried Vouchedfor).  I am reluctant to enter into a full review of our finances and end up having to pay large fees for this when I am reasonably sure (within limits) what I need, and have managed our SIPPs, ISAs and planning for 20 years. If I am only getting the 'commission rate' annuity I might as well just use a broker.

Thoughts welcome

Have you looked into a gilts ladder instead, the "mortality premium" for a fixed term annuity up to SPA may not be that great particularly if it has spouse protection, unless you/spouse are in poor health. Also it seems index linked fixed term annuities are quite hard to find - which if you want to (sort of) replicate the state pension are what you really need. But doing an IL gilts ladder is not too hard if you're used to managing investments yourself and are handy with a spreadsheet

That is beyond my level of knowledge I'm afraid. (Still willing to read up if you have a good link)  Also if anything should happen to me I don't want my wife to have to manage the complexity.  Not going for index linked btw - just a plain single life level annuity (maybe with value protection). Can top up with money from ISA if necessary. Still have to find out if eligible for enhanced annuity.

This may be helpful:
Should you build an index-linked gilt ladder? - Monevator

There's lots of threads here too eg:
https://forums.moneysavingexpert.com/discussion/6493073/index-linked-gilts/

The complexity really is in the setting up the ladder, once it's set up then there's virtually nothing to manage, gilts will mature periodically releasing enough cash till the next one matures if it's been set up right. 

incus432

zagfles said:

The complexity really is in the setting up the ladder, once it's set up then there's virtually nothing to manage, gilts will mature periodically releasing enough cash till the next one matures if it's been set up right. 

I'm sure you are correct but I really wouldn't know where to start with this and I found the links impossible to understand. Mea culpa. 

arthur_fowler

I approached two local IFAs when I wanted to purchase an annuity about two months ago. I wanted execution only. One wouldn't do it without advice and ££ the other was helpful on my first call but took over a week to provide a simple quote and got my details wrong so had to do another write y which took ten days. 
I went with Hargreaves Lansdown instead and they have been fine (not their fault my pension provider is so poor) so far.

xylophone

You could try

https://adviserbook.co.uk/

Tick "confirmed independent" and other options required when the menu comes up.

rebs

I'm just in the process of arranging a fixed term annuity and also did not want to have to deal with an advisor or any sort.

I looked on the moneyhelper comparison and found a couple that would deal direct, which I have looked at.  The best option didn't allow partial transfers - there may have been a work around, but their process of communication was just so awful that I moved onto to the next best one, which is Legal & General - so far it has been super quick and smooth.

dunstonh

rebs said:

I'm just in the process of arranging a fixed term annuity and also did not want to have to deal with an advisor or any sort.

I looked on the moneyhelper comparison and found a couple that would deal direct, which I have looked at.  The best option didn't allow partial transfers - there may have been a work around, but their process of communication was just so awful that I moved onto to the next best one, which is Legal & General - so far it has been super quick and smooth.

How much commission did L&G take?

rebs

dunstonh said:

rebs said:

I'm just in the process of arranging a fixed term annuity and also did not want to have to deal with an advisor or any sort.

I looked on the moneyhelper comparison and found a couple that would deal direct, which I have looked at.  The best option didn't allow partial transfers - there may have been a work around, but their process of communication was just so awful that I moved onto to the next best one, which is Legal & General - so far it has been super quick and smooth.

How much commission did L&G take?

I don't know - they just quoted a price. It's a price I am ok with so I don't entirely care how that is made up.  

dunstonh

rebs said:

dunstonh said:

rebs said:

I'm just in the process of arranging a fixed term annuity and also did not want to have to deal with an advisor or any sort.

I looked on the moneyhelper comparison and found a couple that would deal direct, which I have looked at.  The best option didn't allow partial transfers - there may have been a work around, but their process of communication was just so awful that I moved onto to the next best one, which is Legal & General - so far it has been super quick and smooth.

How much commission did L&G take?

I don't know - they just quoted a price. It's a price I am ok with so I don't entirely care how that is made up.  

When you buy direct, you get a lower annuity rate as they price the commission into the rate.    
When you buy via a non-advised broker, they price the commission into the annuity rate.
When you buy via an adviser (whether advised or execution only), you get the nil commission annuity rate but their fee gets taken from the pension (or can be paid directly).

The nil commission annuity rate will be better than the commission annuity rate.   So, it all comes down to how much the fee to see what difference it makes.

On a small fund, there won't be much of a difference but £50k plus, an adviser on fee basis should be able to beat the commission option.

Whilst you didn't want to deal with an adviser, you probably ended up paying more in commission than the fee you could have paid the adviser and got a better rate (unless it was a small fund).