Annuity calculator
- Estimate the guaranteed income your pot could buy
- Single or joint life
- Level or rising with inflation
- See the monthly and weekly income too
- No sign-up required
Annuity calculator
Enter the pot you'd use to buy an annuity (after any tax-free cash), your age and the options. This estimates the yearly guaranteed income using indicative 2026 rates. Real quotes vary by provider and health.
This is an estimate, not financial advice or a quote. Buying an annuity is usually irreversible, so get a real quote and consider free guidance from Pension Wise before deciding. The "+ state pension" line adds the full 2026/27 new state pension of £11,502. Source: MoneyHelper annuities.
Sources
- Guaranteed retirement income (annuities) explained MoneyHelper
- New state pension rates 2026/27 gov.uk
- Pension Wise free guidance appointments MoneyHelper
How annuities work
An annuity turns your pension pot into a guaranteed income for the rest of your life. You hand the pot to an insurer, and in return they pay you a set amount every year until you die. The income can't run out, which is the whole appeal: it's the closest thing to a private version of the state pension. The trade-off is that you give up the pot and most of the flexibility.
How much you get is driven by the annuity rate, which is a percentage of your pot. At age 67 a single-life level annuity pays roughly 5.5% in 2026, so a £200,000 pot buys about £11,000 a year. Add the full state pension of £11,502 and that's a total guaranteed income of around £22,500 a year for a single person, comfortably above the PLSA minimum.
Why rates rise with age
The older you are when you buy, the higher the rate. That's because the insurer expects to pay the income for fewer years. A 60-year-old might get around 5%, a 67-year-old around 5.5%, and a 75-year-old closer to 7%. This is why some people delay buying an annuity, or buy in stages, to lock in higher rates later.
Rates also depend heavily on interest rates in the wider economy. Annuity rates were poor through most of the 2010s when rates were near zero, then jumped from 2022 as the Bank of England raised rates. That's made annuities far more attractive than they were a decade ago.
The options that change your income
A plain single-life level annuity pays the most up front, but it stops when you die and never rises, so inflation eats into it over 20 or 30 years. Two common changes reduce the starting income in exchange for protection:
- Joint life: keeps paying your partner an income after you die, usually 50% or 100%. It lowers the starting amount but protects a surviving spouse.
- Rising (escalating): the income goes up each year, often by 3% or in line with inflation. It starts lower but keeps its buying power over a long retirement.
You can also add a guarantee period, so the annuity keeps paying for a set number of years even if you die early, and value protection that returns some of the unused pot to your family.
Enhanced annuities: don't miss this
If you smoke, are overweight, or have a health condition like diabetes or high blood pressure, you may qualify for an enhanced annuity that pays more, because the insurer expects to pay it for less time. Plenty of people don't declare these and lose income as a result. It's always worth answering the health and lifestyle questions honestly when getting quotes.
Annuity or drawdown?
This is the big retirement decision. An annuity gives certainty: a guaranteed income you can't outlive. Drawdown gives flexibility: your pot stays invested, you control withdrawals, and anything left passes to your family, but the pot can run out and the income isn't guaranteed. Around 72% of people now choose drawdown, but a common middle path is to annuitise enough to cover your essential bills and keep the rest in drawdown for everything else.
Whatever you're leaning towards, get a real quote before committing, because buying an annuity is usually permanent. Model your pot first with the pension pot calculator, check the tax on any drawdown with the withdrawal tax calculator, and see what the state adds with the state pension estimator.
Common questions
It depends on your pot, your age and the type of annuity. At age 67 a single-life level annuity pays roughly 5.5% in 2026, so a £100,000 pot buys about £5,500 a year, guaranteed for life. A £200,000 pot buys about £11,000 a year. Older ages and level annuities pay more; joint-life and rising annuities pay less at the start.
For a single-life level annuity at 65 to 67, indicative rates in 2026 are around 5% to 6%, higher than they were for most of the 2010s because interest rates rose from 2022. Rates climb with age: a 70-year-old gets more than a 60-year-old for the same pot, because the income is expected to be paid for fewer years.
An annuity gives a guaranteed income for life that can't run out, but you give up the pot and lose flexibility. Drawdown keeps your pot invested and flexible, and lets you pass it on, but the pot can run out and the income isn't guaranteed. Many people do a mix: an annuity to cover essential bills and drawdown for the rest.
A joint-life annuity keeps paying an income to your partner after you die, usually 50% or 100% of the original amount. It costs more up front, so the starting income is lower than a single-life annuity, but it protects a surviving spouse. A single-life annuity pays more but stops when you die, unless you added a guarantee period.
Yes. You can take your 25% tax-free lump sum first, then use the remaining 75% to buy an annuity. The annuity income itself is taxed as normal income when you receive it. Enter the pot after any tax-free cash you've taken.