Here’s an example of why you should not take the first offer when you draw your pension.

Names have been changed to protect the innocent.

Mr A decided to draw his pension.  He’d saved up over the years and ended up with two separate pension policies. One was worth £40,000, the other £20,000 (let’s say).

From that £60,000, he wanted his lump sum of £15,000, leaving £45,000 to buy an income for the rest of his life.

By the time he asked for my help, the pension providers had offered him £206 per month for life.

Luckily for Mr A, he didn’t take that offer.

He gave the £45,000 to a different company instead.  It made sense to choose the company that will pay the highest income, instead of just using the same company he’s saved with.

We got him £241 per month instead.

It pays to shop around.

These figures were compiled in December 2008 and will drift over time.  But you get the point?