I have to buy an annuity. I have been advised to shop around but where do I start?
A good independent financial adviser of course! Bear in mind that indepedents act as YOUR agent. They are not restricted to advising on only one, or a handful, of provider companies products but should look across the entire marketplace to find not only the most appropriate but also best value solution for you.
As such i would even argue that in identifying and then locating the best solution for you at best value, a good IFA will even help you save money - certainly get best potential returns from any solution you choose.
Contrast this with a restricted adviser, or even going it alone, where you may not get best value (i.e. if there are ten solution providers each with their own restricted advisers you have only a one in ten chance of ending up with the best value solution!).
Meanwhile seeking advice means that you not only get the best and most appropriate solution from the whole market for your needs but it also means that the adviser is responsible for any advice they give.
All this often at nil extra cost as providers build in 'distribution' costs to their products which are the same whether you buy directly, from a restricted adviser or from an independent. Indeed some providers expect such distribution costs (often called commission) as they do not want the overheads of paying their own financial advice staff nor then having to assume responsibility for the suitability of their advice. For this reason some of the best value solutions are in fact only avialable through independent financial advisers.
Noting all of the above Why would you go anywhere else? | 11.05.12 @ 12:14
As a further thought buying an annuity could be the longest term decision you ever make - and you cannot change you mind once it is underway!
Do you know the differences between level and escalating, monthly in advance or arrears, with or without proportion, with or without guarantees, temporary annuities, investment annuities, with or without spouses benefit, what circumstances may make you eligible for improved rates, or indeed whether an unsecured drawdown arrangement might not be better - certainly in terms of death benefits?
Taking advice could easily add thousands and give a significant boost to the total returns you will get from buying one annuity rather than another such that any advisory fee will be more than compensated for in my view. | 11.05.12 @ 12:22