Retirees 'should shop around for best annuity rate'

Those approaching retirement are being advised to shop around to find the best annuity rate instead of settling for a product from their existing pension provider.

Craig Fazzini-Jones, a director at MGM Advantage, said many people do not realise that they can compare the rates being offered by different companies, even though they could increase their income by thousands of pounds.

He pointed to research by the Financial Services Authority which showed that last year, more than six out of ten people buying an annuity went for the one offered to them by their pension provider.

"Shopping around is easy to do, especially with the help of a financial adviser," he stressed, adding that many people could qualify for an enhanced annuity if they have a medical condition.

He said minor as well as severe impairments are covered, including high cholesterol and high blood pressure. Those who qualify could receive a higher guaranteed income in retirement.

However, it may also be wise to consider other over 50s finance options, such as pensions, savings and selling business premises.

Keith Churchouse, director at Churchouse Financial Planning, said recently that older people should never rely on one source for their retirement income.

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