Things have improved, though. Germany's current super-generous pension system is to blame for the country's looming demographic crisis, according to economist Hans-Werner Sinn. Fat state pensions, he argues, have persuaded Germans that there is no longer any need to have children to help them cope in old age, and dissuaded them from staying in work beyond the normal retirement age. That's not a problem we're familiar with in the UK. If anything, ours is the complete opposite: thin state pensions and even thinner annuity policy payments.
Unhappiness with annuities was the key trigger behind George Osborne's explosive announcement a year ago that Britons would be allowed to take control of their own pension pots to provide an income in retirement in whatever way they choose.
Like all revolutions, this one shocked and scared as much as it satisfied. The long-term impact could include spiralling house prices, poverty brought about by fraud, mis-selling and incompetence, unexpected tax bills and, ironically, a lack of choice as the annuity market shrivels up. Running out of money is a common problem in other countries where there is no compulsion to buy an annuity: as many as 25 per cent of Australians given access to their pensions at age 55 deplete their assets by the time they reach 70. It's possible they are making the mistake of underestimating their own life expectancy. But we are living longer. In 2012 there were just 13,350 centenarians in the UK. Of men aged 42 now, 59,000 are expected to live to 100 and the figure is closer to 100,000 for women of the same age.
Yet for all the risks, choice is a good thing. People can now choose to use cash to wipe out debts and mortgages rather than handcuffing themselves to a stingy annuity and waving goodbye to their capital. They can invest as they see fit for a better return, or indeed choose to stay cocooned within a system that guarantees an income, albeit paltry, for life. And, by the way, most people should consider investing at least part of their pot in an annuity to insure against the risk of them living a long life.
We should relish our release from a system that forced people to sign up to bad deals, and that locked money out of reach of surviving families.
But whatever you choose to do, our advice is walk, don't run in this new, changing terrain.
Rosie Carr is deputy editor of Investors Chronicle
