Falling annuity rates bigger risk to retirees than market volatility

The annuity adviser has received a surge of calls from people looking to delay annuity purchase as they panic about the effect of market volatility on their pension fund. While the FTSE 100 has slumped 12% in the past two months annuity rates have fallen around 3% during the same period. This means an average £100,000 fund now generates £6,624 a year compared with £6,831 - an annual loss of £207. This can cause an income loss of £5,000 over 25 years. Analysts predict further falls in annuity rates - they have dropped 20% in the last three years. A further 3% fall in annuity rates over...