Pension savers are missing out on the chance of an income boost in retirement because they’re not being honest about their lifestyle or health, writes Jeff Salway.
Up to seven in ten people could get a better deal for their pension pot by taking out an enhanced annuity when they retire, according to new research by MGM Advantage. Enhanced annuities are available to people with health conditions (ranging from high blood pressure to cancer) and to those with lifestyle habits such as smoking. They pay out an average of 23 per cent more to those who qualify on the assumption that their life expectancy is shorter. But 5 per cent of retirees fail to tell their insurer if they fall into that category, often unaware that honesty is the best policy for them when it comes to annuities, MGM found.
“Although the majority of people are honest when filling in the forms to purchase an annuity, some people probably think being open about smoking, drinking or their weight will have a negative effect on the level of income they receive,” said Andrew Tully of MGM Advantage.
“Nothing could be further from the truth. This is why it is vital people approaching retirement and considering their options are honest about any health or lifestyle condition they may have.