The latest evidence from Moneyfacts.co.uk suggests that pension income has dropped by a staggering 60% over the last decade. This is certainly not a good sign for individuals who are looking to retire anytime soon.

The results suggest that pensions have been hit particularly bad over the last few years with the recession reaching British shores. With continually declining annuity rates, reducing numbers of final salary pension schemes and pensions in general not performing as well as they used to, have left many soon to be pensioners in a hard place.

What’s more they report that the average annuity has tumbled over the last decade. With life expectancy increasing and gilt yields falling, the average annuity rates are 28% lower than 10 years ago. The unfortunate reality is that many people are unaware of the falling annuity rates and the impact it could have on their retirement income according to the latest survey by Aviva.

Aviva suggest that around 8.5 million individuals, who are aged over 55, are currently losing out on retirement income as they are ‘ignorant’ over annuities. Aviva has suggested that individuals are not aware of the various annuity options available, with some paying out more than others. They also suggest that most people opt for a standard annuity package, however many would be eligible for an enhanced or impaired annuity, which pays out more, on health grounds.

Choosing the correct annuity would certainly help circumvent some of the losses that your pension may have seen over the last few years, however it is unlikely to make up the full amount lost. But as Tesco says “Every little helps”.