Friday 2nd June 2006
Shopping around for the best annuity can save pensioners a tidy sum, according to a new report.
The Prudential Annuities Index indicates that the difference between the best and worst annuities can be as much as 20 per cent, with the worst deal offering £5,860 a year from a £100,000 fund, some £1,070 less than the best deal around.
In addition, those eligible for an impaired life annuity could earn up to £7,830 each year from their pension, around 33 per cent more than the poorest rate.
Pensioners are being to warned to be extra vigilant this year, as average annuity rates are considerably down on 2005, around £200 lower on average on last years rates.
"Pensioners retiring today are receiving lower incomes than those retiring a year ago mainly because the continuing decline in gilt and bond market yields has reduced conventional annuity rates across the market," explained Aston Goodey, head of retirement at Prudential UK.
The average annual income for a 65-year-old male retiree on a £100,000 fund is £6,540. 
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