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Annuity rates 'increasing due to credit crisis'

Annuity rates are on the up as a direct result of the credit crunch, the Observer reports.Figures from stockbroker Hargreaves Lansdown cited by the newspaper show that average rates have increased from around seven per cent early last year to 7.85 per cent for male retirees.This is due in part to rises in yields from corporate bonds - which has in turn been caused by their increased popularity in the financial crisis as a "safe" investment.The annuities news comes as a welcome boost, following a negative report from Baring Asset Management which showed that one third of Britons have made no private pensions provision at all.Worse still, a recent study from insurer Life Trust found that the average pensioner needs savings of around £326,000 in order to live comfortably in retirement.Commenting on the annuities trend to the newspaper, David Marlow at Alexander Forbes Annuity Bureau said: "Rates are better than they have been for a long time."

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