An annuity is a secure, regular income which you purchase from an insurance company using your pension fund when you choose to retire. The insurance company is then responsible for paying you a secure income for at least the rest of your life.
When you retire, up to 25% of your total pension fund can normally be taken as a tax-free lump sum immediately. The remainder can then be converted into an annuity which will pay you a taxable income, any time from age 55. Please be aware tax rules are subject to change and the benefits will depend on your individual circumstances.
When choosing your annuity you can choose the features that suit your needs. For example:
Our annuity rate best buy tables show you the best annuity rates currently available from our panel of twelve leading providers including, Aviva, Legal & General, Prudential and many more.
The tables are updated weekly, however, to get the very latest annuity rates for your personal annuity quote you can use our FREE online annuity calculator.
Once you have set up your annuity it can't be changed for the rest of your life. You only have one chance to get it right so it's vital you choose your options carefully and shop around for the best annuity rates.
Two very important points to consider
What you do with your pension is an important decision – in the case of an annuity it is irreversible. Make sure you understand your options and check they are suitable for your circumstances: take appropriate advice or guidance if you're unsure. Our service is not personal advice but we can offer advice if you specifically request this. The Government's free Pension Wise service can also help - more on Pension Wise.
Find out how our online annuity calculator ensured Mr Meager increased the income from all three of his pensions when he converted them into an annuity.
I first used the Hargreaves Lansdown Annuity Service a few years ago when arranging my wife’s annuity purchase. We wanted to try out the service and could not have been happier. When I decided to purchase an annuity using my own pensions Hargreaves Lansdown was the first port of call. I had three different pension plans that I was converting into an annuity.
I knew Hargreaves Lansdown would search the whole market for me to get the best deal possible and they obtained better rates on all three of my pensions, combining them all into one annuity for ease. My pension provider didn’t mention that I could get an enhancement if I suffered from any medical conditions. Hargreaves Lansdown picked this up straight away and managed to further increase the rate they could obtain. It was more than £400 more than my pension provider’s quote. The whole process was extremely smooth and I was kept well informed of the progress the whole way through. I would have no hesitation using the Hargreaves Lansdown annuity service again, and have already recommended it to friends and family members.