Annuity Rates

Spivo46

I am figuring from the data i have seen that annuity rates have fallen by 1% (annual return) in the last 5 months. With interest rates and guilt performance falling are we seeing the end of annuities for the foreseeable future?

Hoenir

This is the 7th time since 2022 that markets have been forecasting a significant lowering in future interest rates due to more benign inflation. Suggests that many are still yearning for the easy life of the QE era that has well and truly past. Annuities remain a product worth considering. Always will be. 

Spivo46

Hoenir said:

This is the 7th time since 2022 that markets have been forecasting a significant lowering in future interest rates due to more benign inflation. Suggests that many are still yearning for the easy life of the QE era that has well and truly past. Annuities remain a product worth considering. Always will be. 

Agreed, but at what cost? all fixed term quotes are coming in under 4% this week and it was over 4% last week

QrizB

Spivo46 said:

I am figuring from the data i have seen that annuity rates have fallen by 1% (annual return) in the last 5 months.

Based on what data?

The chart here suggests that level annuities are off their peak, but have only fallen from 7.4% to 7.1%.

And HL's best buy table stil looks pretty healthy.

The equivalent table from the 1st of September is here if you want to compare.

What exactly are you comparing that leads you to think rates are down by a full 1%?

Hoenir

Spivo46 said:

Hoenir said:

This is the 7th time since 2022 that markets have been forecasting a significant lowering in future interest rates due to more benign inflation. Suggests that many are still yearning for the easy life of the QE era that has well and truly past. Annuities remain a product worth considering. Always will be. 

Agreed, but at what cost? all fixed term quotes are coming in under 4% this week and it was over 4% last week

That seems exceptionally low. What type of annuity is this? 

QrizB

Hoenir said:

Spivo46 said:

Hoenir said:

This is the 7th time since 2022 that markets have been forecasting a significant lowering in future interest rates due to more benign inflation. Suggests that many are still yearning for the easy life of the QE era that has well and truly past. Annuities remain a product worth considering. Always will be. 

Agreed, but at what cost? all fixed term quotes are coming in under 4% this week and it was over 4% last week

That seems exceptionally low. What type of annuity is this? 

From the OP's previous threads (example) it looks as though they're shopping for an annuity that pays an income for 2-3 years then returns 100% of the capital at the end.

A bit of a niche product, in other words.

Spivo46

Hoenir said:

Spivo46 said:

Hoenir said:

This is the 7th time since 2022 that markets have been forecasting a significant lowering in future interest rates due to more benign inflation. Suggests that many are still yearning for the easy life of the QE era that has well and truly past. Annuities remain a product worth considering. Always will be. 

Agreed, but at what cost? all fixed term quotes are coming in under 4% this week and it was over 4% last week

That seems exceptionally low. What type of annuity is this? 

fixed term

Spivo46

From the OP's previous threads (example) it looks as though they're shopping for an annuity that pays an income for 2-3 years then returns 100% of the capital at the end.

A bit of a niche product, in other words.

Correct, i got a 3 year @ 4.4% but still have the opportunity to change my mind

Hoenir

Spivo46 said:

From the OP's previous threads (example) it looks as though they're shopping for an annuity that pays an income for 2-3 years then returns 100% of the capital at the end.

A bit of a niche product, in other words.

Correct, i got a 3 year @ 4.4% but still have the opportunity to change my mind

Then the answer is no. Annuities are likely to continue to thrive. Grow in popularity. Now that Gilt yields are "normalising" once again. For those seeking a lifetime guaranteed income without risk they are ideal. 

Thumbs_Up

QrizB said:

The equivalent table from the 1st of September is here if you want to compare.

What exactly are you comparing that leads you to think rates are down by a full 1%?

For those who are interested here is a screen grab from June 2023.

Spivo46

Thumbs_Up said:

QrizB said:

The equivalent table from the 1st of September is here if you want to compare.

What exactly are you comparing that leads you to think rates are down by a full 1%?

For those who are interested here is a screen grab from June 2023.

thank you - Just tried HL quoting system and offered 6% with guarantee for 20 years, 66% payout to OH if i pop it!