Pension transfer advice 'should be sought regularly'

Brits who are setting money aside in preparation for later life may wish to ensure they seek pension transfer advice on a regular basis.

This can help ensure the financial products invested in are best suited to the individual's requirements and income is maximised in advance of retirement.

Director of Chapters Financial Limited Keith Churchouse asserted it is important to ensure professional assistance is sought frequently throughout a person's life.

He noted this is particularly the case in the current economic climate, as annuity rates have been in decline for a long time.

It was specified the past six months have seen dips in the overall rate consistently and this is having a negative impact on those who are saving for when they finish work.

Many people may wish to seek the support of an adviser if they do not know what annuity is.

This could be a particularly pressing issue, as recent research from MGM Advantage indicated 71 per cent of UK adults over the age of 55 do not fully understand what this is.

Concern was expressed over this lack of awareness as there is currently a significant gap between the top and bottom enhanced and standard annuity rates.

For instance, a shortfall of 54 per cent could be suffered by an individual with a pension pot worth £500,000 as a result of this discrepancy.

Mr Churchouse suggested considering pension transfer options very carefully in order to avoid retiring with a lack of sufficient funds to cover living expenses in retirement.

"People do have the opportunity to defer pension benefits until a later date which may or may not see their income improve, but that is on a basis that they can fund themselves during that period where they are not working and not drawing pension benefits and they need to seek financial advice to make sure that their planning is correct," he explained.

Ashall Glover Financial Services, pension transfer specialists

Posted by Charles Powell