Retirement provider Canada Life has increased its annuity rates for the 16th time this year.
The provider’s benchmark reference annuity of £100,000 at age 65 will now pay around £6,353 income a year, compared to £4,542 for the same annuity purchased at the start of 2022.
The increase boosts guaranteed income on a £100,000 annuity by £1,811 a year, an extra £36,220 over a 20-year period.
After many years of decline annuity rates have been creeping upwards this year, thanks mainly to increases in the base rate and gilt yields improving.
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Nick Flynn, retirement income director, Canada Life, said: “Annuity rates have continued to bounce back following changes to base rate and the improvements in yields on gilts, with rates up around 40% this year. This sustained growth in potential income warrants giving annuities a second look, especially for anyone concerned about income security in retirement.
“Annuities can play a key role in retirement plans and it will always pay to shop around for not only the best rate but the right shape annuity.”
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