The Money ’s Worth of annuities in the UK between 2006 and 2014

Publication date: Available online 26 October 2016 Source:The Journal of the Economics of Ageing Author(s): Matteo Aquilina, Robert Baker, Tommaso Majer Improvements in life expectancy and the fall in interest rates have had a significant impact on annuity rates but not on their Money’s Worth (MW). Following the ban of gender-based price discrimination, MW has decreased for male annuitants and increased for female annuitants. This paper investigates the ‘value’ of annuities in the United Kingdom (UK) and examines how this has changed from January 2006 to June 2014 ‘the relevant period’. During the relevant period the MW of a standard annuity bought on the open market was, on average, 94% for a 65-year-old male annuitant with a £50,000 pension pot.
Source: The Journal of the Economics of Ageing - Category: Health Management Source Type: research