Thousands of retired people locked in to poor value
annuities are desperately seeking an exit. Pension
companies have reported a flood of queries in recent
weeks from pensioners who exchanged retirement pots
for annuities – a fixed income for life – but who now
want out.
Annuity rates have tumbled in recent years but under
current rules once a plan is purchased, it cannot be
unwound.
Enquiries to get out have jumped following the
introduction of new pension freedoms last month, which
hands those aged over 55 greater flexibility over how
they take cash from retirement pots. These include the
removal of the obligation to convert a lifetime of pension
savings into an annuity.
Many pensioners have the false impression they can
now cash in unwanted annuities as easily as they can
their pension plans.
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