Have we reached peak annuity rates?

woolly_wombat

Now that the higher interest rate medicine appears to be working and gilt yields are slightly down, does it look as though annuity rates have peaked for now?

OH had a surprisingly good annuity estimate from Legal and General via moneyhelper, but when he went to the L&G website he got a slightly lower estimate using the same parameters. Struggling to understand why that is. 

The pension he was proposing to annuitise happens to be with L&G.

QrizB

Rates might have peaked.

On the other hand, a slight difference in quotes could simply be due to differing commission/fee arrangements.

woolly_wombat

QrizB said:

Rates might have peaked.

On the other hand, a slight difference in quotes could simply be due to differing commission/fee arrangements.

Might an IFA be able to get a better deal?

Albermarle

woolly_wombat said:

QrizB said:

Rates might have peaked.

On the other hand, a slight difference in quotes could simply be due to differing commission/fee arrangements.

Might an IFA be able to get a better deal?

They say they can in many circumstances. Also they will have access to more personally tailored annuities ( there are a lot of possible options) than you can get yourself apparently.

dunstonh

OH had a surprisingly good annuity estimate from Legal and General via moneyhelper, but when he went to the L&G website he got a slightly lower estimate using the same parameters. Struggling to understand why that is. 

IFAs and intermediaries tend to get the best annuity rates.   However, that is mainly where there is some enhancement due to health/lifestyle.
L&G will be taking a commission for doing it directly.   As will any DIY service.   So, whatever commission they decide to take will be deducted from the annuity rate.    So, that will account for some differences.

woolly_wombat

dunstonh said:

IFAs and intermediaries tend to get the best annuity rates.   However, that is mainly where there is some enhancement due to health/lifestyle.

L&G will be taking a commission for doing it directly.   As will any DIY service.   So, whatever commission they decide to take will be deducted from the annuity rate.    So, that will account for some differences.

Thank you dunstonh.
Adding what we thought were quite minor health issues into the mix has proved surprisingly lucrative, and has spurred us on to pursue further health checks.

michaels

woolly_wombat said:

dunstonh said:

IFAs and intermediaries tend to get the best annuity rates.   However, that is mainly where there is some enhancement due to health/lifestyle.

L&G will be taking a commission for doing it directly.   As will any DIY service.   So, whatever commission they decide to take will be deducted from the annuity rate.    So, that will account for some differences.

Thank you dunstonh.
Adding what we thought were quite minor health issues into the mix has proved surprisingly lucrative, and has spurred us on to pursue further health checks.

Of course any gains will be swallowed up by massive hikes in travel insurance costs....

westv

woolly_wombat said:

Now that the higher interest rate medicine appears to be working and gilt yields are slightly down, does it look as though annuity rates have peaked for now?

OH had a surprisingly good annuity estimate from Legal and General via moneyhelper, but when he went to the L&G website he got a slightly lower estimate using the same parameters. Struggling to understand why that is. 

The pension he was proposing to annuitise happens to be with L&G.

See what the HL annuity calculator shows too.

woolly_wombat

westv said:

See what the HL annuity calculator shows too.

The best quote to date has come from HL, certainly better than going direct to L&G.

We are told to shop around but it can be hard to know where to look…..

sgx2000

woolly_wombat said:

dunstonh said:

IFAs and intermediaries tend to get the best annuity rates.   However, that is mainly where there is some enhancement due to health/lifestyle.

L&G will be taking a commission for doing it directly.   As will any DIY service.   So, whatever commission they decide to take will be deducted from the annuity rate.    So, that will account for some differences.

Thank you dunstonh.
Adding what we thought were quite minor health issues into the mix has proved surprisingly lucrative, and has spurred us on to pursue further health checks.

I am in exactly the same position..
I am 63.  Potentially just 2.5 years until retirement (probably sooner)
My pension is with Aviva...
Unfortunately you have to fill in a paper health issue document to get their quote (no online form)
But I need to persuade my doctor to do some tests... to get the latest results...
1 or 2 of the tests will almost certainly make a difference to the quotes

I have been wtching the annuity rates and am starting to think theer is more chance the rates will go down if I wait untill I am 66...

Bimbly

My pension is with Aviva...

Unfortunately you have to fill in a paper health issue document to get their quote (no online form)

I have been wtching the annuity rates and am starting to think theer is more chance the rates will go down if I wait untill I am 66...

Oh course, just because your pension is with Aviva, you don't have to take your annuity out with Aviva. A quote from them is a good place to start, but shop around too.

I wouldn't like to advise you on whether to get your annuity now or later, but I certainly understand the need to get it "sorted" and so you don't have to worry about it any more. If you buy your annuity now, remember to stop looking at rates afterwards!