When your investment in your pension plan reaches maturity, you’ll need to transfer its accumulated value into a regular income for the remainder of your retirement. This can be achieved by purchasing a pension annuity - a simple and straight forward transaction that exchanges the value of your pension fund into which you have been paying a regular income.
While the principle of a pension annuity is seemingly very straight forward, however, things are rarely quite as simple as they seem.
The most critical aspect of buying a pension annuity is that it is a long-term, one-off commitment. You only have one shot at it, as there is no going back and asking for a refund of all of the capital simply because you have found a better deal elsewhere. Therefore, it is very important that you make the right choice.
Making the right choice is made harder due to the fact that a host of different annuities all offer a host of different annuity rates - i.e. will offer same amount of pension investment for a different level of income.
For more Independent Pension Advice visit Source IFA.
