If you’re approaching your retirement, you may already have heard about OMOs, or open market options, but what does this refer to and what is its significance?Get Your Free Quote
It’s actually fairly simple. The Open Market Option lets you access your pension pot and take any retirement product from your provider of choice. It offers you total flexibility to choose exactly how you take your retirement income. In most cases, your retirement finance solution will be to buy a lifetime annuity. So in this instance, the Open Market Option refers to your freedom to shop around and seek the best available rate for your Annuity.
It is uncommon for you to find the best annuity rate with your current pension provider, so it is important to look at other providers and do your research to find the best offer. By using the OMO, you will be able to discover who offers the best rate for your circumstances and desired annuity type.
Yes. You’ll find that there can be up to thirty per cent difference in the rates between the worst annuity provider and the best one. Equally, if you simply default to using your existing provider rather than looking at what’s available on the market, you could find that your income is adversely affected not just in the current year, but in your future retirement years. This can be avoided entirely by looking at what’s available on the market and taking the time to shop around.
Additionally, by carrying out this research you will discover where you can qualify for specialist or enhanced annuity products due to your lifestyle or health issues. Remember, these can further increase your income and are worth investigating if you are eligible. Factors such as smoking, your weight and even your postcode can have an influence on the annuity payment you will receive.
They don’t, but informed customers will to make sure they get the best price for their retirement savings. Around one-third of individuals who purchase an annuity currently make use of the Open Market Option. This means that the vast majority two-thirds of people approaching retirement haven’t compared providers or found out whether they could qualify for a specialised or enhanced annuity which would pay them more money.
Various reasons are worth considering:
No, there is no charge for using the OMO and your existing pension provider cannot apply any cost for it. Equally, the majority of Independent Financial Advisors (IFAs) will not charge you for checking if you will qualify for Enhanced Annuity products, or for checking to find the best available annuity rate.
In conclusion, it makes sense to use the Open Market Option and maximise your chances of getting the best income from your pension. It really is the only guaranteed way of getting the best retirement option for your needs and the best available rate for the annuity product you choose.Get Your Free Quote
Use our simple calculator to see how much your income is likely to be.Try the calculator
You could qualify for an enhanced annuity if you have a medical condition or lifestyle that means your life expectancy might be shortened.See if you qualify
Just call our help desk on
0800 088 2496
and we'll answer any question
you might have on securing
the best income for your