Over 50s unaware of annuity choices

Virtually half of over 50s don’t know that annuities are available many kinds and with varied choices, in accordance with analysis from Commonplace Life, a part of Phoenix Group.

The examine steered widespread ignorance about annuities amongst older folks.

When those that had already annuitised, or deliberate to take action, have been requested about completely different annuity choices, there was restricted familiarity with the choices obtainable:

  • Simply over a 3rd (37%) are accustomed to single life annuities.
  • Solely 1 / 4 (26%) are accustomed to degree annuities.
  • Only a quarter (24%) are accustomed to inflation-linked annuities.
  • Solely 10% of over 50s are conscious of enhanced annuities.
  • Simply 10% are conscious of worth/capital safety.

Many over 50s mistakenly imagine that annuities won’t permit them to go on wealth to surviving family within the occasion of their dying, and state this as a key barrier to buying one.

One in ten (13%) usually are not planning to buy an annuity due to this cause, with greater than half (56%) of throughout 50s unaware that an annuity may be set as much as cowl the lifetime of a surviving companion.  

That can be mirrored amongst these over 50s who’ve already purchased an annuity, or are contemplating doing so, with only a quarter (27%) accustomed to joint life annuities. Moreover, just one in 5 (20%) are accustomed to the time period “assure interval”.

Pete Cowell, head of annuities at Commonplace Life, stated: “In the end, essentially the most appropriate kind of annuity is often decided by an individual’s monetary targets and particular person circumstances. The analysis means that many individuals of retirement age may overlook their choices because of a lack of expertise and miss out on the peace of thoughts annuities can present. Skilled recommendation can play a vital position right here in serving to folks perceive the true worth of an annuity.”

Annuity charges have strengthened considerably over the past two years and the newest Commonplace Life Annuity Charge Tracker discovered that charges for a wholesome 65-year-old reached 7.25% in September 2023.

• The analysis was commissioned by Commonplace Life and performed by Opinium, with a nationally consultant pattern of two,000 over 50 years outdated, between 6th– 14th March 2023.

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