Annuities look fair value

Increases in the value of pension funds over recent decades have offset the negative effects of falling annuity rates, according to research commissioned by the University of Bristol. Although annuity rates have fallen from a high of 18% in the 1970s to around 4% today, broadly in line with interest rates, the research claims the current generation is no worse off in terms of retirement income than predecessors over the past 50 years, because of the increasing value of pension funds. Over the period under examination, 1956-2002, the average annuity rate for a 65-year-old male has been jus...