Annuity Rates Fall in Wake of Brexit

Pension income has taken a hit following Britain's vote to leave the European Union. Two annuity providers have cut rates - with more expected to follow

Emma Wall 27 June, 2016 | 10:01AM
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Retirement income has taken a hit thanks to uncertainty around the future of the British economy. Two pension providers have announced today that they will be cutting annuity rates following the Brexit vote on Friday – and experts expect more to follow.

Just Retirement and Retirement Advantage have both announced annuity rate cuts, with Just Retirement’s rates are down by around 2%.

Andrew Tully, Pensions Technical Director at Retirement Advantage confirmed: “We’ve reduced our annuity rates by 3% as markets adjust to the UK leaving the EU. Customers with existing annuities in payment are of course unaffected. Customers in the process of buying an annuity have a 14-day guarantee period which protects the rate offered.

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Emma Wall  is former Senior International Editor for Morningstar