: You pay a lump sum from your "defined contribution" pension to an insurance company.
: Increases each year, either by a fixed percentage or in line with inflation, to protect your purchasing power. Key Considerations Before Purchasing Consumer's Guide to Understanding Annuities buying a pension annuity
: Offers higher income if you have certain medical conditions or lifestyle factors (e.g., smoking) that may shorten life expectancy. : You pay a lump sum from your
Current annuity rates (which recently reached an 18-year high due to rising gilt yields). Your age and health status. Common Types of Annuities Current annuity rates (which recently reached an 18-year
: The amount you receive depends on several factors: The total size of your pension pot.
: Continues to pay a portion of the income to a partner or beneficiary after your death.
Buying a pension annuity is a significant financial decision that involves converting your pension savings into a guaranteed regular income for the rest of your life or a set period. This process, typically available from age 55 (rising to 57 in 2028), provides "peace of mind" as the income is generally unaffected by stock market fluctuations or interest rate changes once established. How Buying an Annuity Works