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Annuity rates on the up, investors pour billions of pounds into funds this summer, and an insurance warning to households that employ carers. Our round-up looks at the latest personal finance developments to affect the over-50s.
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The average annual income paid out by a standard annuity has risen by £100 in the past six months, according to research from data providers Moneyfacts.
Annuities are a type of product mainly offered by insurance companies that pay a guaranteed income for life in exchange for a lump sum of cash - often from a maturing pension plan.
In addition to income drawdown, an annuity is one of the two main ways of producing retirement income from products such as personal and self-invested pension policies.
According to Moneyfacts, a £50,000 lump sum for a 65yo paid an annual income of £3,653 in August 2026, compared with £3,547 six months earlier.
The reason for the increase is because the performance of annuities is linked to the performance of gilts, a type of investment that can be likened to a government IOU.
In recent months, 10-year gilt yields have risen above 5%, partly thanks to political uncertainty at home with the arrival of new prime minister, Andy Burnham, coupled with turbulent economic times further afield caused by the ongoing Middle East conflict.
With unused pension pots due to be included within inheritance tax calculations from next April, Moneyfacts anticipates that annuities could prove increasingly popular in the coming months.
Moneyfacts’ Rachel Springall said: “Annuities are due a resurgence in popularity over the coming years as they can reduce the overall value of an estate, with unused pension pots subject to inheritance tax from April 2027.
“There are varying income options on annuities, such as those that link to inflation or rise by a set percentage and applicants in poor health could even be eligible for an enhanced annuity. Making sure the annuity is set up correctly to suit a pensioner’s circumstances will be vital.”
Retail investors, the likes of you and me, have been pouring billions of pounds into investment funds this spring and early summer, with June 2026 attracting the largest monthly amount in five years.
According to the latest figures from the Investment Association (IA), an industry body, investment funds have enjoyed eight consecutive months of net inflows.
The IA said just over £12 billion was invested in the first six months of the year, with £3.8 billion recorded in June 2026 alone, a five-year high for a single monthly figure.
But the encouraging findings could yet be short-lived. They come amid ongoing global economic uncertainty caused by the Middle East conflict, as well as months of political turmoil closer to home that has seen Andy Burnham replace Sir Keir Starmer as the UK’s latest prime minister.
Separate figures from Calastone suggest the picture was less rosy for the investment industry by July, when outflows of equity funds, those invested in assets such as stocks and shares, hit their largest figure since last autumn’s Budget.
Miranda Seath, a director at the IA, said investors had shown resilience this summer by staying invested in the markets, “but by shifting their portfolios to lower-risk strategies with bonds, diversified mixed assets and cash-like assets taking centre-stage”.
Edward Glyn, Calastone’s head of global markets, said: “Tax rises, and even speculation about tax rises, change investor behaviour. The evidence increasingly suggests that policy unpredictability is unnerving investors almost as much as the tax measures themselves.”
More than three-quarters of UK households that pay for carers to help around the home could be unknowingly uninsured and exposed to serious financial risk should a helper make a claim against them.
The warning comes from a specialist insurer that carried out a survey of 250 UK households that employed carers.
Surewise found that more than three-quarters of households (78%) thought their home insurance policy would cover them if a carer was injured working around the home. But a standard home cover policy would not typically extend to employers’ liability insurance.
Meanwhile, a third (33%) of households said they had never checked with their insurer whether their policy covered carers or personal assistants, despite the reality of the risk for carers.
Surewise added that 10% of households had no insurance in place at all.
Stuart Bensusan, a Surewise director, said: “More families are hiring carers directly to look after loved ones, often becoming employers for the first time without realising the legal responsibilities that come with it. Standard home insurance does not necessarily include employers’ liability cover, so it’s important to check you have the right protection in place.
“Employment status is determined by the reality of the working relationship, not simply how someone describes themselves. A carer who considers themselves self-employed could still be found to be an employee in the eyes of the law.”
Parents are providing their adult children with financial support worth, on average, in excess of £11,000 each, according to research from Spring.
The savings app found that around one in seven adult children receive money from the so-called ‘Bank of Mum & Dad’. Of those recipients lucky enough to receive a cash injection, the amounts were often significant in size.
About a third received financial support worth between £1,000 and £4,999, while amounts between £5,000 and £9,999 had been handed to nearly a fifth (18%) of recipients.
Spring added that nearly a quarter of recipients benefited from a windfall worth in excess of £10,000. It found that parental support is being used to help overcome major financial obstacles, particularly those linked to housing and affordability.
Derek Sprawling, head of money at Spring, said: “Many people associate the Bank of Mum & Dad with helping younger family members on to the property ladder, but these findings show the scale of support being provided can be significant.”
Making financial gifts is a noble gesture. But if payments are not organised or recorded carefully, they can potentially fall foul of strict gifting rules as applied by HMRC, the UK’s tax authority, and have can prove problematic in terms of estate planning and inheritance tax calculations later in life.
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