Annuities > Choosing a Pension Annuity

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Choosing a Pension Annuity

When you receive a quotation from your pension provider, you may wish to shop around to try and find a more attractive annuity. This is called taking the Open Market Option. By law, you are entitled to take the value of your pension scheme and buy an annuity off another provider. You may choose to do this because another provider offers better terms and can provide you with a larger retirement income, or another provider can satisfy your retirement needs whilst your current provider cannot.

Could I get a better retirement income by buying my pension annuity off the open market?

By shopping around, pensions experts estimate that some retirees can increase their retirement income considerably, in some cases by 50% or more. This will depend on the age and health of the pension scheme holder. This is extremely significant because it influences the level of annuity payments received by the pension holder every month.

Once you have decided to shop around for a pension annuity, it is a good idea to make sure you know the facts of your pension scheme, including your projected retirement income. You can then proceed to assess your pension annuity options and choose the one most suitable for you.

To learn more about the different forms of pension annuity, please proceed to Types of Annuity and check our Annuity Glossary to better understand the terms used.

How do I find out more about annuities?

Please click here to read the Pensions.co.uk guide to pension annuities. Because some of the terms relating to this product are confusing, please also visit our glossary of terms for a full explanation of the jargon.