Pension returns could fall

In 2019 an annuity could cost up to 60% more than it does today

BBC Radio 4's Money Box was broadcast on Saturday, 17 April, 2004, at 1204 BST.

The programme was repeated on Sunday, 18 April, 2004, at 2102 BST.

Future pension returns could be worth less than many people expect as insurers build in more protection against rising longevity.

People in money purchase pension schemes must buy an annuity before they are 75, which unlocks the money they have saved and provides an income in retirement.

The income - or annuity - is provided by an insurance company. But analysts have warned insurers they are taking on a high risk as people are living so much longer.

As a result, the cost of buying an annuity in 2019 could be anywhere between 34% and 60% higher than it is today.

Meanwhile, some annuity rates have been climbing.

To discuss these issues we were joined by:

Peter Tompkins from PriceWaterhouseCoopers

Stuart Bayliss of Annuity Direct

Tony Philbin from Legal & General

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With-profits exit penalties

Millions of with-profits policyholders are still facing huge exit penalties if they try to cash in their investments early, despite improvements in the stock market.

Louise Greenwood investigated.

Further information:

No easy exit from with-profits funds

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Muslim finance

HSBC has launched a pension fund that complies with Islamic law, aimed at the UK's two million Muslims, who had previously been excluded from many conventional types of investment.

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The fund will not be invested in any companies whose main business involves alcohol, gambling, pornography, pork products, financial services or tobacco.

To discuss the new product and ethical investing, we were joined by Julian Lyne, Head of Institutional Pooled Funds at HSBC, and Stella Rice, of the Ethical Investment Association.

Further information:

HSBC offers Islamic Pension Fund

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Liquid Gold

Thousands of Bank of Scotland customers may be disappointed to learn that their savings accounts are being changed to one with a poorer interest rate, the notorious Halifax Liquid Gold account.

Chris A'Court reported.

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Savings

We were joined by Anna Bowes of Chase De Vere to round-up the latest deals for savers.

Further information:

Britons fail to heed saving alert

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Money Box Investigates

On Tuesday, Money Box asks why the poorest people pay the highest interest rates when they borrow, and asks if there should be a legal limit on interest charged.

Programme information:

The Price Of Poverty

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Producer: Chris A'Court
Presenter: Paul Lewis
Reporter: Louise Greenwood
Web Producer: Nathalie Knowles