What Is An Open Market Option (OMO)?
Introduced as part of the 1975 Finance Act the Open Market Option (OMO) Allows someone coming up to retirement to select the best annuity or retirement option from the whole of the market rather than taking the default option from there current pension provider. Getting advice and searching the entire market may increase a pensioner’s retirement income by as much as 30%.
Currently as many a 1/3 of those looking to retire still do not seek the appropriate advice and search the entire market, however the ABI have recently launched their code of conduct which will help those who have saved for 30 or 40 years to get the best product for their circumstances.
The code of conduct makes sure customers will have access to the information that will allow them to make an informed decision. It requires providers to give their customers clear and consistent communications and to signpost the fact that they can shop around for the most appropriate product. They also have to explain the benefits of enhanced annuities and if they offer them and point out where advice can be found both from government sources and financial advisers.
Getting the right advice and not automatically choosing your current providers option can really make a difference and will help to maximise your income in retirement.
Contact us for advice about taking your open market option. You only have one chance at buying an annuity.