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06 Jan 2014

Economic Recovery Set To Bring About Pension Boost

As most economists agree that the British economy is heading towards recovery and growth, pension funds are set to benefit as well, with those about to retire and buy an annuity profiting the most, the Daily Express reported.

Thanks to satisfactory performance in 2013 on the part of blue-chip UK firms, the FTSE100 Index closed at the end of the year 14% higher than 12 months ago, meaning that the largest firms have added billions of pounds of value over the past year. This trend is expected to continue over the course of 2014.

What this means to those about to retire is that their annuity will be worth more money, providing them with a higher income over the period of their retirement. Over the past few years, annuity rates have been very low, forcing many retired people to struggle to make ends meet. As the stock exchange recovers, millions of workers are estimated to get a pension boost, the news source said.

However, not everybody will benefit from higher retirement income, the Express pointed out. Thousands of British women are saving much less than they need to in order to secure the income they would feel comfortable with. On average, female workers estimate they can live well with about £25,000 per year but in reality, they could receive just over £17,000, simply because they have not put aside as much as they should have done during their working life.

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