The world of annuities has been turned upside down of late thanks to a directive from the European Union. The directive in question relates to the current disparity in the rates quoted for annuities paid out to men and women which has stood for a number of years. As a result, from December 2012, the rules governing annuities are set to change, but what does it mean for you and your annuity?
- Male annuity holders will see that the rate they are offered fall from their current level once the directive becomes signed into law. This means that, if you’re a man and need to buy one, the time is now. Going to people like my pension expert for advice on annuities and comparing what the different providers on the market currently have to offer is advisable.
- As for females, their rates will rise slightly after the changes later this year. This means that they will receive higher rates and therefore a better deal from the beginning of January 2013, which would make purchasing an annuity now a pretty poor decision, especially if you want to provide for your future.
- As for annuity rates in general, they are likely to fall overall by the end of this year. This is why it’s important to shop around for the best deal in order to get the most from your annuity, especially for men.
- One of the main reasons for the law change is that, because women live longer, they will get an improved rate as their annuity is expected to last for a longer period. As the average male life expectancy is lower, their annuity payments will be larger because they won’t live as long as women.
Your annuity is very important, so you should do whatever you can to get the most out of it, whether you have to get one before or after the rules change. If you do, you’ll feel safe knowing that your annuity will give you the best possible support when you eventually retire from work.