Shop Around For A Higher Income...What Makes The Open Market Option Attractive?
When your pension fund reaches maturity, pension providers advise you of the fund value and should give you general information about annuities and your expected level of annuity income.
You are then entitled to use your Open Market Option, which allows you to transfer your pension fund value to another annuity provider and receive a potentially higher retirement income.
The Open Market Option allows retirees to shop around for different ways to convert their pension fund into an annuity, as opposed to just taking the rate offered by your pension provider.
It allows you to shop around for a potentially higher annuity rate than that offered by your current pension provider but enables you to explore different ways to convert your pension funds into a retirement income.
Many Don't Use The Open Market Option
Many still do not use their Open Market Option, not just because they are unaware of the benefits of doing so, but don't actually realise they have an option.
It has been claimed that those at retirement who do not use their option, taking the default annuity offered by their pension provider may be missing out on up to 40% more income.
To make the most of the Open Market Option it is important that you speak to an annuity expert who'll explain the different retirement options available and remember, you don't have to just accept the rate offered by your current pension provider. You could get more income from a pension annuity than you think.