Question 1

How much annuity income can a £150,000 pension pot buy?

Accepted Answer

The annuity income from a £150,000 pension pot depends on age, the type of annuity (single life, joint life, or inflation-linked), and whether a guaranteed period is included. As a rough guide, a 65-year-old buying a single life level annuity with a £150,000 pot might receive around £11,838 per year at current illustrative rates. The calculator below can run scenarios.

Question 2

How does an annuity compare with drawdown?

Accepted Answer

An annuity provides guaranteed income for life but usually means giving up access to the pot used to buy it. Drawdown keeps the pot invested with flexible withdrawals but carries investment risk and income is not guaranteed. With a £150,000 pot, the comparison is between certainty, flexibility, tax treatment, death benefits, and investment risk. FCA-regulated advice may be useful for personalised guidance.

What annuity will a £150,000 pension pot buy? reaching for moderate retirement.