Annuity income tumbles £2k since Budget pensions overhaul

Average annuity rates have fallen in the third quarter of 2014 by 2.38%, MGM's research suggests. The average standard annuity rate fell by 3.01%, while enhanced rates fared slightly better, reducing by 1.88%. That means the average annuity today of £3,074 per year - based on a £50,000 pension pot - would pay £2,058 less income over an average retirement compared to the equivalent annuity purchased in March. Annuity rates are linked to what it costs the government to borrow over a 15-year term, the yield on gilts, because insurers largely buy these gilts to provide the income paid to ...