Pension savers 'missing out'
2.09.2008
Delays in the process of transferring funds into annuities when people retire could mean they lose out financially, according to a new report.
Virgin Money has warned that annuity transfer delays could potentially lose thousands of pounds in income.
The firm stated that a 65-year-old man with a £100,000 fund can expect an income of £645 a month, but would stand to lose £1,935 if his pension provider delays paying him for three months.
Scott Mowbray, spokesperson for Virgin Money, said: "Buying an annuity is a one-off decision and one which retired people have to literally live with. With a fixed annuity the income you receive is fixed for life so the losses from delays are also fixed for life."
Arguing that the risk of losing money is a "genuine threat", Mr Mowbray claimed pension providers need to improve the time it takes to transfer funds.
In related news, the Department for Work and Pensions recently urged those over the age of 60 to ensure they are claiming all the benefits they are entitled to.
Virgin Money has warned that annuity transfer delays could potentially lose thousands of pounds in income.
The firm stated that a 65-year-old man with a £100,000 fund can expect an income of £645 a month, but would stand to lose £1,935 if his pension provider delays paying him for three months.
Scott Mowbray, spokesperson for Virgin Money, said: "Buying an annuity is a one-off decision and one which retired people have to literally live with. With a fixed annuity the income you receive is fixed for life so the losses from delays are also fixed for life."
Arguing that the risk of losing money is a "genuine threat", Mr Mowbray claimed pension providers need to improve the time it takes to transfer funds.
In related news, the Department for Work and Pensions recently urged those over the age of 60 to ensure they are claiming all the benefits they are entitled to.