30 April 2007
The Actuarial Profession has issued a briefing note to help
explain some of the common misunderstandings about Annuities to the
public and those who advise them.
The briefing note explains:
What an annuity is and how it works.
How the annuity market works and some of the issues surrounding
the cost of annuities to the consumer.
Whether annuities offer fair value for money.
The briefing note goes on to examine how and why annuities have
become more expensive over time and the implications of this trend
for pensioners.
Adrian Eastwood, Chairman of the Actuarial Profession's Life
Board, said: "This brochure explains how annuities work and why
people should seriously consider using them as a means of providing
the income they need in retirement.
It includes estimates of the likelihood of living past age 90,
by when those who saved for retirement but chose not to buy an
annuity, would be likely to find that they have used up their
savings.
The brochure will be particularly relevant to those coming up to
retirement as it also provides a summary of the different forms of
annuity on offer and warns people not to overlook any valuable
guaranteed annuity rates that their pension savings policies may
have."
