How to Find the Best Annuity Rates for Your Retirement

What You Need to Know

1. Annuities are generally provided by insurance companies and are designed to supply you with an income after you've retired.
2. There can be huge differences in the level income offered by different annuities.
3. Men traditionally received better rates due to having lower life expectancy, but thanks to new EU legislation this is no longer the case.
4. Your age, health, post code and the value of gilt bonds will all go towards the rate you are offered.
5. The recent climate of economic uncertainty has pushed up the price of gilt bonds and consequently reduced annuity rates.
6. To ensure you’re making adequate provisions for later life it’s best to talk to an independent financial advisor.

There is a substantial difference in the size of income that the best and worst annuity rates pay out. As such, it’s crucially important that you secure the best rate available to you for your pension pot as once you've made your choice you can’t go back on it.

What is a Pension Annuity?

An annuity is a type of financial product that provides you with a regular monthly income in exchange for your pension pot when you retire.

Annuities are typical provided by insurance companies. Some of the leading UK providers include Aviva, AXA, L&G, Scottish Widows, Prudential and Standard Life.

As with any form of insurance product, the provider will make calculations as to how much money they will need to pay out and offer a rate accordingly. One of the biggest factors here is your life expectancy as the longer it is, the more regular payments that the provider must make.

This is the reason that, until very recent EU legislation that ruled annuity rates cannot be gender bias, women generally got lower rates as they typically live longer than men.

Pension annuities used to be compulsory in the UK for all by the age of 75. However, since spring 2011 this deadline has been removed, which allows you to be more flexible and choose when you feel is a good time to buy an annuity. This change also opened up other options such as income drawdown.

What affects the annuity rate I am offered by pension providers?

• Your Age: All other aspects being equal, the older you are the higher the rate you will be offered.
• Your Health: If you have any health conditions, are overweight or are a smoker, you may qualify for an enhanced annuity which will give you a higher monthly income.
• Your Life Expectancy: This is the biggest factor affecting the rate you receive.
• Your Postcode:
Providers are using postcode information as part of their evaluation process to predict life expectancy.
• Government Gilt Returns: These are investments that are held by pension providers and affect the annuity rates they offer. Higher returns generally mean better rates.

Annuity Rates are at Historic Lows

Annuity rates have been declining for two decades because of extending life expectancies. Since 2007’s economic downturn, however, the situation for retirees has been made more bleak.

With the volatility of stock markets in recent years there has been increased demand for government gilt bonds, seen as a safety bet in uncertain conditions. This has meant that gilt prices have risen leading to proportionately smaller returns. This is bad news for retirees and means incomes are lower now than pre-credit crunch.

Retirees have been further hit by the economic uncertainty in the eurozone which has put the squeeze on UK annuity rates.

The Golden Mantra: Shop Around for the Best Annuity Rates

Whilst the annuities market is struggling there is still value to be found for retirees. The key is to speak to an IFA and shop around for the best annuity rates on the open market. Options such as enhanced annuities and drawdown can be very attractive.

Market Unlikely to Change Soon

A key takeaway here is that experts are not predicting any sizeable increases in annuity rates in 2013. As such, taking the approaching of doing nothing in the hope that the market may pick up soon is not advised.

A far wiser solution is to speak to an independent financial advisor.

Importance of Using an IFA

This is critically important. The only way to ensure you get the best options in retirement for your is by speaking to a qualified independent financial advisor (IFA). Emphasis being on independent here, as IFAs are required by law to advise you to the best option for your needs, regardless of commission or provider bias.

It is important to understand that there are never one-size-fits-all best solutions when it comes to retirement planning. Every retiree has a highly individualized set of needs and circumstances that must be fully considered when choosing an annuity.

Remember, once you make your choice here, there is no changing it.

Too Much Credit Card Debt? How to Fight Back and Eliminate Credit Card Debt

If you are experiencing too much credit card debt, there is a way to fight back and eliminate your debt in a lawful way. Although there are various means of eliminating your debt and getting rid of your financial issues, the most significant thing is solving your problems in a legally accepted method. Although there are methods like debt consolidation, bankruptcy and debt settlement, after considering the after effects of these, you should be in a position to select the best method for you.

Debt consolidation should be done when you have multiple debts, but, it is not a solution for your debt problems because debt consolidation is not a way out of you're debt responsibilities. Bankruptcy appears to be a effective solution as it manages to free you entirely from your debts which have always been a worry to you. But, it is not the conclusion of your financial issues, as it brings further problems to you. It definitely destroys all your credit history and even harms your good reputation. In addition it restricts some of your rights very considerably. You will definitely lose your right for acquiring any bank loans in the next fewyears. This has a large effect on you as most businesses depend on bank loans. Therefore, these types of problems can definitely put you in to more trouble if you select bankruptcy.

Whereas debt settlement exclusively brings relief rather than bringing you further financial issues. This is obviously a way of fighting to eliminate your credit debt, you are not directly fighting; instead you are having negotiations with the help of some professionals in the debt settlement field. In this method a series of negotiations are going on between the creditors and the counselors in the settlement company who works for the debtors. Therefore, the success of the debt negotiations solely depends on the ability of the counselors to fight. Thus, your debt settlement will definitely be more successful and you will be able to eliminate a greater amount of money, perhaps 50% or 60% of your due amount, if you go through a very talented and legitimate company. Thus, when selecting the company, you have to confirm the legitimacy of it by going through the contact details and the other given information about the particular company. If you did good research on the company, you will definitely be able to produce a better result and finally be debt free!

Tip For The Best Balance Transfer Credit Cards

Balance transfer credit cards make an excellent choice for consumers looking to transfer a balance from a higher interest rate credit card to one with a lower interest rate. In this way, the consumer can save money by reducing or even eliminating finance charges. When looking for the best balance transfer credit cards, it is important to look at a variety of factors.

The APR is one of the first factors a consumer should consider when looking for the best balance transfer credit cards. Credit card companies are hoping to steal your business away from other credit card companies. As a result, they often make special introductory offers with lowered interest rates for balance transfers. In many cases, this APR will even be 0.00%. Be sure to find the balance transfer credit card offering the lowest APR, and then only use that card for your balance transfer. Don't use it to make any purchases. This is what the credit card companies are hoping consumers will do so they can assess finance charges on the purchases they make with their card.

The length of the special introductory APR varies from card to card. Sometimes, the length is also dependent upon the applicant's credit history. It is important to be sure how long this period lasts and to set goals to have the balance paid in full once the introductory period is complete. The best balance transfer credit cards will keep the special introductory rate in effect on the card for the life of the loan. In other words, the APR stays the same until it has been paid off entirely. For consumers that will not be able to pay off the balance within the introductory period, this is certainly the best way to go.

Most credit cards assess fees when making balance transfers. These fees are generally determined as a percentage of the total amount of funds transferred. Most commonly, balance transfer fees are 3% of the amount transferred. Many balance transfer credit cards will, however, waive these fees during the introductory period. It is best for consumers to choose these balance transfer credit cards. Otherwise, they may be paying large amounts in fees, negating the savings in finance charges.

Some balance transfer credit cards require initiating balance transfers at the time of application for the card. Yet others allow balance transfers to be completed throughout the duration of the introductory period. The best balance transfer credit cards are the former, simply because they allow for more flexibility. Consumers who are sure they will not need to transfer balances later may, however, be happy with a credit card that only allows transfers to be made at the time of application.

Some balance transfer credit cards place restrictions on the types of balances that can be transferred. For example, some business credit cards only allow business expenses to be eligible for introductory rates. It is important for consumers to be sure to understand what type of balances can be transferred before applying for a card to ensure it meets their needs.

Many balance transfer credit cards also have special rewards programs. Consumers need to compare the programs before deciding on a credit card so they can choose the card with the rewards program best suited to their lifestyle. In addition, some balance transfer credit cards do not count the funds that are transferred toward the points system used in the rewards programs. To get the most of the card, consumers should find balance transfer credit cards that do count the transfers toward their rewards programs.