Henry Irving 13 August 2019
Even though you might have paid off some of your larger expenses, like your mortgage, bills don’t stop when you reach retirement.
For a retired couple the average weekly spend is £498 which equates to £2,158 a month. And unfortunately, this won’t get covered by the State Pension. In fact, it would fall short by £699 every month.
You could consider buying an annuity to make up the difference. It’s still one of the only ways of providing a secure lifetime income from your pension. And if you do, you’ll have peace of mind knowing you’ve got enough money to help cover any household costs, meaning any spare cash can be spent on life’s little luxuries.
You don’t have to swap all your pension to buy an annuity. How much you use is completely up to you. You can just swap part of it for a regular secure income, and you could move the rest of your pension into drawdown for flexibility.
For example, let’s say you’re 65 years old and you want an extra £100 a month of secure gross income, you could buy an inflation linked annuity with £42,000 of your pension. Remember annuity income is taxable. Tax rules can change and depend on your circumstances.
|Monthly Income||Amount needed to buy an inflation linked annuity|
We generated these quotes using our online annuity quote tool on 13 August 2019. All quotes are for a single life annuity with no guarantee period, paid monthly in advance that will rise in line with RPI. Quotes are for a 65 year old who is single and lives in an area which has an average life expectancy.
If you want to get an idea of how much you might need in retirement, try our budget calculator.
Could you get a higher annuity income?
We all want the best deal out there, whether it be on our car insurance or the latest phone contract. So why should it be any different when it comes to our retirement income?
Yet a surprising 70% of people aged 55 and over don’t know they could qualify for a higher annuity rate.
All you need to do is provide your health and lifestyle details when you get a quote. Even the most common health conditions could mean you get a higher income, like high blood pressure.
You don’t need to be ill to qualify either. Disclosing minor details like how much alcohol you drink or your height or weight, could mean you get a higher income. And the extra money can be staggering.
Annual income from a £100,000 pension
Scroll across to see the full chart.
We generated these quotes using our online annuity quote tool on 13 August 2019. All quotes are for a single life annuity, paid monthly in advance, with no escalation or guarantees built in. Quotes are for a 65 year old who is single and lives in an area which has an average life expectancy.
Remember, even if you choose not to buy an annuity, there’s no obligation after you get a quote.
Plus, if you get an enhanced annuity quote by 19 August 2019, you’ll be entered into our prize draw.
It’s important to consider your annuity options carefully as once set up annuities can’t usually be changed or cancelled. Quotes are only guaranteed for a limited time and rates could go up or down in the future.
Win a Fortnum & Mason wine hamper
We’re giving away five £175 Fortnum & Mason wine hampers. But the clock is ticking. You must get a quote and enter your health and/or lifestyle details by 19 August 2019. See terms below. Wines will vary from those shown.
What help is available?
If you’d like to get a quote over the phone, or if you have any questions, you can call our annuity experts on 0117 980 9940. They’re available six days a week: Monday-Thursday 8am-7pm, Friday 8am-6pm and Saturday 9:30am-12:30pm.
What you do with your pension is an important decision. We strongly recommend you understand your options and check your chosen option is right for your circumstances. Take advice or guidance if you’re unsure.
The government provides a free and impartial service to help you understand your retirement options - more on Pension Wise.
What are the full terms of the offer?
- If you obtain an enhanced annuity quote using our annuity service (a “Quote”) between 07:00am on 5 August 2019 and 11:59pm on 19 August 2019 (the “Offer Period”) we will enter you into our prize draw (the “Draw”) to win a hamper worth £175 subject to these terms and conditions. The Draw is only open to individuals who obtain an enhanced annuity quote with us. Annuity quotes which are not enhanced quotes will not be entered into the Draw. The Draw is free to enter.
- To be eligible to win a prize, you must also:
- be 55 or older;
- be resident in the United Kingdom;
- not be an employee of any Hargreaves Lansdown group company or a member of any such employee’s immediate family or household;
- comply with these terms and conditions.