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Annuity Rates
This is a free guide to find the best standard annuity rates for you with up to 25% more income for the new Unisex annuity rates on a gender neutral basis applying to both males and females. Use the Free annuity quote service to compare this to a fixed term or flexible income annuity, a higher pension income if you are a smoker or up to 40% more income for impaired health.
Annuity Rates
  More annuity topics
  Annuity rates table - standard
  Smoker rates table
  Outlook for rates 2020
  Changes in the market
  Annuity rates chart
  Latest gilt yields chart
  15-year gilt yields
Pension annuities could fall with Omicron variant 27 November 2021:
Pension annuities could fall over 1pc with new Covid variant Omicron
Annuity Rates Table - Standard

27 November 2021 last updated

Table 1 below shows standard annuity rates for a pension fund of £100,000 after the tax free lump sum of £33,333 has been taken from the full fund of £133,333 for a single and joint life based on a Central London postcode.
Single Standard Basis
Age Level rate
no guarantee
Level rate +
10-year guarantee
3% escalation
no guarantee
55 £3,897 £3,869 £2,236


£4,318 £2,677
65 £5,164 £5,059 £3,438
70 £6,055 £5,831 £4,269
75 £7,269 £6,851 £5,517

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Joint Standard Basis
Age Level rate +
50% Joint Life
Level rate +
100% Joint Life
3% escalation +
50% Joint Life
55 £3,607 £3,414 £2,050
60 £4,039 £3,761 £2,448
65 £4,677 £4,339 £3,067
70 £5,513 £5,076 £3,886
75 £6,686 £5,909 £5,010

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Table 1: Standard pension annuity on a single and joint basis for 1 November 2021

Table 1 Notes:

Annuity rates based on a central London postcode (other locations such as Peterborough or Liverpool could be up to 4% higher or Dundee and Newcastle could be 5% higher) using a purchase price of £100,000 - this assumes an original pension fund of £133,333 and after the tax free lump sum of £33,333 has been taken. Income is gross per year (before deduction of tax) and payable monthly in advance for the whole of the annuitant's life. No medical enhancements are included in these annuities. The pension annuity table is only a guide as annuities change frequently. Figures shown have been adjusted for Unisex annuity rates on a gender neutral basis and joint life rates assume both are the same age.

Outlook for rates 2021

This review is by Colin Thorburn the founder of who has twenty years experience in financial services and is a specialist in pensions and annuities.
The following table shows where annuities should be relative to gilt yields although providers can take time to change annuities for marketing reasons:

What Next For Annuity Rates
Annuity Type Expected Change (medium term)
  Standard basis
  annuity rates change 1.3% decrease possible
  Smoker basis
  annuity rates change 0.6% decrease possible
  Impaired basis
  annuity rates change 0.6% decrease possible

The latest annuity rates would need gilt yields to remain consistently at 1.00% for a change to occur across the board in the medium term.

We follow the progress of our benchmark annuity rate for a person aged 65 with a fund for £100,000 buying an annuity on a single life, level basis. Below shows the annuity rates and gilt yields over the last six years to date:

Annuity Rates Chart Annuity Rates Chart
Read the latest annuity rates review to find out if this is the best time to buy an annuity.
Annuity Rates Changes Annuity Rates Changes
Find out about the latest changes in annuity rates and if they are rising or falling.
15-Year Gilt Yields 15-Year Gilt Yields
The 15-year gilt yields have a significant effect on annuity rates which we update daily.

Changes in the market

Find out more details:
Monthly analysis of annuities and gilt yields

The 15-year gilt yield decreased by 9 basis points to 1.15% during October 2021 with providers of standard annuities increased rates by an average 2.67% for this month and we would expect rates to fall by -1.21% in the medium term if yields remain at current levels.

For smoker and enhanced annuity providers have increased their rates by an average of 2.52% and rates may fall by -0.51% in the medium term if yields remain at current levels.

New covid variant called Omicron by the World Health Organisation could be more contagious than the Delta variant sends investors to the safety of bonds and gilts resulting in 15-year gilt yields reducing by 13 basis points to 1.00% on 27 November 2021.

This has result in global restrictions to travel which could impact the economy sending global equity markets lower. Investors had expected a rise in long term inflation with stimulus and return to consumer spending. The lower gilt yields could see annuity rates reduce by -1.3% if gilt yields remain at current levels or fall further.

Pfizer and BioNTech announcement on 9 November 2020 successful trials of a vaccine with an efficacy level greater than 90.0% in preventing Covid-19. Just a few days later research from Moderna showed their vaccine produced efficacy levels of 94.5% raising hopes the economic damage caused by lockdowns may now have come to an end.

Federal Reserve Intend to hold rates at a record zero percent and continue with the bond buying programme to support the economy until 2022. The Fed statement in August 2020 intends to allow inflation to exceed 2% before applying monetary policy.

Investors seek safe havens with 15-year gilt yields down 50 basis points for the month to an all time low of 0.162% on 9 March 2020. Yields remain volatile starting the year at 1.07% and reduced 91 basis points due to the combination of coronavirus threat to global growth and now the oil price war.

15-year gilt yields reached a
low of 0.566% on 3 September 2019 after concerns over a no-deal Brexit, the US-China trade tensions and fear of recession. Since January 2019 providers have lowered annuities with standard annuity rates falling by -12.69% and gilt yields reduced 72 basis points to 0.71% at the start of September.

Equity markets recovered in February 2019 with the FTSE-100 index rising 652 points from 6,584 on 27 December to 7,236. Equity markets around the world have reduced with about $5 trillion in value wiped from the global stock and bond markets in October 2018.

Uncertainty in December 2018 over Britain's exit from the European Union with a deal acceptable to parliament and risk of a no deal is sending investors to the safety of gilts and bonds and yields reduced 27 basis points to 1.36%.

Investors are selling bonds and gilts sending 15-year gilt yields higher to 1.73% in September 2018. This could be due to Trump's $200 billion of trade tariffs on Chinese imports and the risk China could retaliate by selling its large Treasury bond holdings to push up the cost of US borrowing.

Concerns over Italy's political turmoil in May 2018 are driving investors to sell Italian bonds in faviour of safe havens such as US Treasury, German Bunds and UK gilts. The crisis has sent the 15-year gilt yields lower by 31 basis points from a high for the month of 1.81% to a low of 1.50%.

On 2 November 2017 the Bank of England increased interest rates to 0.5% up from the all time low level of 0.25% reached after the Brexit vote with 15-year gilt yields now at 1.62%, up 28 basis points since the low of 1.34% on 7 September 2017.

In June 2017 gilt yields were up 19 basis points was due to the European Central Bank (ECB) stating the factors suppressing inflation are short term implying the quantitative easing programme come to an end.

The 15-year gilt yields reached another all time low of 0.90% on 11 August 2016 following the Brexit vote sending standard and impaired annuity rates lower. UK credit rating reducing to AA, the governor of the Bank of England announced lower interest rates to 0.25% and £70 billion of quantitative easing has resulted in the 15-year gilt yields reducing.

Decreases in annuities during 2015 were due to economic uncertainty such as the falling oil prices, deflation in the Eurozone and the ECB starting a €1.1 trillion stimulus programme, poor economic data from China and high interest rates from Russia. This contributed to uncertainty and investors seeking safe havens such as government bonds and gilts.

Legal & General expect the UK annuity market to shrink in size from £12 billion to £2.8 billion following new pension rules from April 2015. This could see providers developing more flexible annuity products in the future or people considering flexible drawdown or fixed term annuities allowing them to take an income and to access their fund to consider their options again in the future.

The Chancellor George Osborne announced radical changes for pensions in the 2014 Budget allowing people at retirement more freedom to take their benefits in any way they feel is appropriate. This includes being able to take the full fund as a lump sum less tax rather than buying a pension annuity.

Find our more: radical Budget changes for pensions

Annuities for 2020-2021:
Annuity rates reached an all time low in August 2016 after the Brexit vote and close to this level in October 2019 following uncertainty with the US-China trade talks and the UK leaving the EU at the end of 2020.

With gilt yields near all time lows due to the Coronavirus pandemic, annuity rates reached another low in January 2021 as the Covid-19 lockdown was in force and recoved to a recent high in October 2021 with the successful vaccination programme in the UK. As uncertainty continues with the new strains of Covid-19 such as Delta and Omicron it is likely annuity rates will remain at current levels in the medium term and rise when investors return to equity markets.

In the long term assuming the UK and global economies improves with interest rates returning to higher levels, gilt yields can improve and this would mean annuities increasing although the process could take many years.

The Bank of England reduced interest rates to 0.25% on 29 July 2016 after the Brexit vote and with improvements in the economy raised these back to 0.75% on 3 August 2018. Uncertainty with Coronavirus has seen the Bank of England reduce interest rates to an all time low of 0.1% on 19 March 2020.

Equity markets:
Many pensioners remain investment in equities at retirement and changes in the FTSE-100 index can make a significant difference to the pension income they will receive, up or down. The FTSE-100 index reached a recent low of 4,993 on 23 March 2020 and is currently at 7,044 on 27 November 2021.

Purchasing an annuity can often take a month so to protect against volatility in the markets pensioners invested in equities should consider switching their fund to cash to avoid further decreases in their pension fund value or delay purchasing an annuity until the current crisis has stabilised.

15-year gilt yields:
Gilt yields last month changed from 1.24% to 1.15% or 9 basis point. Yields reached a low of 0.162% on 9 March 2020 and pension annuity rates are offering lower value to pensioners whereas purchased life annuities offer better value. On 27 November 2021 the 15-year gilt yields were at 1.00%.

Pension annuity

A pension annuity can be a fantastic way to ensure a pleasant retirement, and by comparing annuity rates it is possible for you to increase your pension income by up to 25%. Being financially prepared for retirement is extremely important for you to live a comfortable and secure life and to ensure such an existence many people choose to buy a pension annuity. It is important to remember that this is an investment that has to last you for the rest of your life, so comparing annuity rates is highly advisable before you make your choice.

It can be difficult for some people to look ahead and consider planning for a time when you are not working, but it is an essential consideration if you want to enjoy as lifestyle that allows you some financial freedom. A pension annuity could allow you just that freedom and put you in a far better position to enjoy a much happier retirement, with less to worry about financially. Nobody likes the idea that money worries will be a problem when they are older so taking action now could be one way to securing a much brighter future all round, so do have a good think about where you want to be.

What do the Best Rates Depend On?
There are a number of different factors that annuity rates depend on. For instance, the annuities will be different as mortality differs for a range of ages. Other factors that annuity rates are dependent on include the following:

Smoker/non smoker – annuities can vary significantly between smokers and non smokers   
Illness – illness is another thing that can have a noticeable effect on annuity rates
Care needs – annuity rates can also be affected if an individual has immediate needs such as care homes
Impaired health

Because annuity rates can differ so much it is essential to compare annuities on the market to find one that will suit your requirements, and you can do that here at Sharing Pensions.

Of course, whilst we do try to secure the best annuity rates that we can they are reliant on a number of external factors which are beyond our or your control. This could include things such as the value of government bonds and gilts, Bank of England base rates and other monetary factors such as quantitative easing. We know that you will be interested in seeing details about annuity rates and how they have performed historically and you can find this information on our website. Our website is very helpful in this respect and lays out all the information you could require in a simple and easy to read manner.

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