Annuity Calculator
Estimate the annual income an annuity would provide from your pension pot, using current UK annuity rates.
How Annuity Calculator works
How annuity rates work
An annuity pays a guaranteed income for life in exchange for your pension pot. Rates are expressed as the annual income per £10,000 of pot. At 65, a level single-life annuity typically pays around £630–700 per year per £10,000 in early 2025.
Factors affecting annuity rates
Age (older buyers get better rates), health (enhanced annuities for smokers and those with medical conditions), interest rates (higher rates → higher annuities), annuity type (level pays more than index-linked), and life basis (single pays more than joint).
Annuity vs drawdown
An annuity provides certainty — you cannot outlive it. Drawdown offers flexibility and potential for higher returns, but carries investment risk and longevity risk (running out of money). Many retirees use a combination: annuity for essential income, drawdown for discretionary spending.
Enhanced and impaired-life annuities
If you smoke, have a medical condition, or a shorter life expectancy, you may qualify for an enhanced annuity paying significantly more than standard rates. Always shop around using the open market option — your pension provider's own annuity is rarely the best available.
Frequently asked questions
How much annuity will £100,000 buy?
At age 65, a level single-life annuity from £100,000 provides approximately £6,500–7,000/year (£542–583/month) at current market rates. Rates vary — always get quotes from multiple providers.
Is an annuity better than drawdown?
It depends on your health, circumstances, and risk tolerance. Annuities are best for those who want certainty and have no other guaranteed income. Drawdown suits those with other guaranteed income, good health, and ability to manage investment risk.
Can I change my mind after buying an annuity?
No. Annuities are irreversible once purchased. There is a brief cooling-off period (typically 30 days) after sale but generally once committed, it is permanent. This is why shopping around before purchasing is critical.
What happens to my annuity when I die?
A single-life annuity simply ends. A joint-life annuity continues paying a proportion to your spouse/partner. A guarantee period annuity pays out for a minimum period (e.g., 5 or 10 years) even if you die sooner. Value protection returns a portion of the premium on death.
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This calculator provides estimates for informational purposes only. It is not a substitute for personalised pension or financial advice. Speak to a regulated financial adviser before making pension decisions.