Fixed-term annuity savers hit by low investment returns

Savers who bought a fixed-term annuity five years ago could be left up to 18 per cent worse off than someone who bought a lifetime annuity.

Enhanced annuity specialist MGM Advantage has analysed the total retirement income a 65-year-old man with a pension pot worth £100,000 would receive if they had bought a five-year fixed-term annuity on 1 January 2008.

The provider’s analysis assumes that at the end of the term the individual buys an annuity based on their health at the time. To find out why a fixed-term annuity is not a no-risk product, follow this link to the full article from Money Marketing.