Careful and thorough financial planning is essential for those entering retirement.

This is according to director of Chapters Financial Keith Churchouse, who said falling annuity rates over the past six months have made this more important than ever.

He stated older individuals "are now finding that the income which they can achieve is significantly lower than they had first anticipated".

Instead of leaving any financial planning until the last minute, Mr Churchouse suggested it is something individuals should be doing gradually throughout their lifetime.

He also recommended seeking professional advice on the matter to ensure people have not made any mistakes and have significant funds built up for the future.

It seems Mr Churchouse is not the only expert of this opinion, as head of corporate communications at Skipton Building Society Tracy Fletcher recently claimed the currently difficult economic climate makes financial planning more important than ever.

She added "developing the disciplines of careful budgeting" will help people cope if there is another downturn.