More than one in five retirees continues to work even when they have gone well beyond the age of 60. A good number of these retirees will not be in this condition if they didn’t get stuck on a poorly-paying annuity plan. According to a recent survey (by Retirement Assured), life is definitely not slowing down for a lot of people over the age of 60 as more than a million retirees are currently doing what they can to boost their retirement income. The most common way through which this is achieved is by starting a business or pursuing a dream job. The study showed us that 18% of these individuals are working beyond 60 years of age because they cannot afford to rely solely on income due to them from their retirement savings. The study further showed that 43% of people who are aged 60 and above have to watch their spending each day, doing a great deal of budgeting in the process while another 19% of individuals are still working deep into their later years.
Many of the retirees who are working today or set up a business for themselves later in life do so because they found an opportunity and had to embrace it and others are doing something they have always wanted to do all their life. However, the study shows us that over 18% of retirees have to work because they need the income. One in five of this group even find themselves with more problems than they ever had during their more active life. Of course, it is great seeing the number of retiree owned businesses blossoming well be it travel, dog walking, or consultancy but it is important for people who are working at an age when they should be enjoying their years of hard work to be sure that they are doing it for the right reasons. The purpose of retirement gets defeated when you have to work deep into those retirement years because you do not have any other choice. This explains why individuals who are nearing retirement must make sure that they have secured the best possible type of retirement income they have built up over their working life.
One of the ways through which retirees set up retirement income for themselves after retirement is to purchase an annuity contract. Purchasing this contract is definitely one of the most important decisions you will ever make in life and so you need to ensure that you have considered all options possible for your individual situation. In getting an annuity deal, factors like where you live, your state of health, and the age of your partner can impact the amount you will end up receiving. Buying an annuity is far from other such financial contracts (car insurance of mortgage). This is because these other commitments allow you to change your mind if you get things wrong but annuity contracts cannot be altered once they kick in, showing you the importance of ensuring that you get things right at the first time of asking.
Here are four steps to getting a good annuity deal:
Talk to an annuity specialist
This is the first step you need to take even in the presence of the growing number of DIY schemes that help individuals make annuity decisions. If you can easily and comfortably make decisions that you won’t regret later on then of course you can avoid making out time to see an annuity expert. But then again, how many individuals have this sort of knowledge? A good number of people are put off from consulting annuity specialists due to the fees they may have to pay. However, this isn’t a good reason to take a massive gamble on an annuity purchase. You may lose more than that nominal fee in the long run and again, do you know that the supposed DIY sites get a commission from the annuity company you end up with? Specialists like Annuity Rater are experts in the annuity field and are worth the initial investment instead of gambling on a DIY policy. Expertise in this field is advised so you can make the best decision possible.
Have a look at the annuity options available to you closely
Before you settle for an annuity plan, you need to be sure you are fully aware of the pros and cons of each type of annuity. This will help you know which ones apply to you more than the others and also reduces the chances of making a mistake. With proper weighing of the pros and cons, the only other problem you should be worried about is choosing options that are ill-advised. This is where an adviser will also be of immense help. It is very easy to mistake certain options as very good only to find out much later that it reduces the possibility of you getting value for money before you pass on.
Don’t keep away your health issues
Hiding your health issues can rob you of as much as 50% more income in some cases. Annuities are not like life insurance so you don’t have to hide your health conditions. Again, even the smallest ailment can increase your retirement income so do not wave off any condition. Smoking, obesity, and deep snoring are all common conditions that can earn you reasonable increments in annuity income.
Shop around extensively
Shopping around is what helps you ensure that you are getting the best possible deal from your annuity provider. There have been instances where individuals got over 25% increments in income by looking elsewhere for annuity contracts under the same conditions. Shopping around is a hassle for the average individual though so working with an annuity expert is still the best way to go.
By painstakingly following the above steps, you can be sure that you will never have to go back to working in your 60s unless you are really happy doing it and it is not just for the money alone.