Annuity rates fall after winter stability

Annuity rates tumbled in April after a brief period of stability during the winter, according to Alexander Forbes Annuity Bureau.

Womens' annuities fared better than those for men, and smokers benefited from a rise in top rates.

The top performing level annuity for a male aged 60 with a £100,000 pension pot was £6,280 from Aviva, down from £6,420 a month ago.

Women fared slightly better, with Aviva's equivalent rate falling from £6,070 to £5,960.

Smokers were the only group to see an improvement in rates, with a 60-year old male spending £100,000 able to get an annuity of £7,086 from LV=, compared to Reliance Mutual's top rate of £7,023 a month ago.

Tim Whiting, director of the Alexander Forbes Annuity Bureau, says: "April has been a disappointing month for annuitants with most providers dropping their rates across the board.

"There were some surprises from well-known names and we urge all those approaching retirement to consider taking the open market option to get the best rate. We would also urge careful consideration of the possible alternatives. In changeable market conditions it is sensible to consider the whole range of retirement options."