The open market option is an invaluable option open to you when you retire from a money purchase pension (i.e. a pension that is not linked to your salary).
In the run up to your retirement your pension provider will offer you an income in return for the value of the pension pot that you have saved with them. (This income is known as an annuity.) The open market option means that you do not need to accept your existing provider’s annuity and you can shop around to find the highest level of income (the highest annuity rate) available.
People who don’t take the open market option are missing out on exploring if they can increase their income in retirement. Once an annuity (your pension income) is in payment it is not possible to change provider, so there are no second chances.
If you want to know more about this or how it affects you personally, contact us today and find out more.