Best annuity rates June 2026

Best annuity rates compared

Rising interest rates over the past few years have helped to boost the amount you can get from an annuity.

Our tables give an idea of how much healthy 65-year-olds and 70-year-olds with a £100,000 pot could get for three different types of annuity: 

• a single-life annuity
• a joint-life annuity where the surviving partner of the same age receives 50% of the original payments
• a joint-life annuity where payments rise by 3% each year

Annuity rates for a 65-year-old

Annuity rates for a 70-year-old

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'High annuity rates should continue for the foreseeable'

Paul Davies, Which? pensions expert, says:

'Annuity rates are closely tied to gilt yields and the Bank of England base rate. When the base rate goes up, gilt yields rise too – and that pushes annuity rates higher, as we've seen in the past few years. 

Annuity rates for a healthy 65-year-old have been above 7% since 2022 and consistently above 7.5% since the start of 2025. 

With the Bank of England not expected to cut rates in the months ahead, it's likely retirees will continue to be able to take advantage of competitive annuity deals.

You'll generally find that the older you are when you arrange an annuity, the higher the annuity rate you'll get, reflecting the fact that the annuity provider won't have to pay out for as long. 

You should also be offered a higher rate if you have a serious health condition, for the same reason. So mention any conditions at the outset.'

How to get the best annuity for you

Shop around

Don't automatically accept the annuity rate offered by your pension provider without checking what's on offer across the rest of the market.

Consider your loved ones

Single-life level annuities - which pay out the same income every year and then will stop paying out when you die - tend to offer the highest rates, because annuity companies know they only have a set amount to pay out for the lifetime of one person.

But this means your partner won't get anything if you die before them. Joint-life annuities offer lower incomes than single-life annuities, but will keep paying out to your partner if you die first. 

Declare any health conditions

It's important to fully disclose details about your health and lifestyle, as you may qualify for an enhanced annuity rate - giving you a higher income - if any of these factors negatively affect your life expectancy. 

Consider inflation

Opting for an annuity that pays a fixed amount every year means that over time you'll find your income doesn't stretch as far because it isn't rising in line with inflation. 

Inflation-linked annuities ensure that your payments increase each year, but you'll need to weigh up whether you're willing to accept the lower starting income they offer. 

It could take you a decade before this income matches what you would have received at the beginning from a level annuity, and many more years before you've received more income overall. 

How are annuity rates calculated?

The broader economic picture will determine overall trends in annuity rates, but exactly how much income you get will depend on your personal circumstances.

Gilt yields

Annuity providers typically fund annuities using returns from government bonds (known as gilts), which are among the safest types of investment. 

The government pays the annuity provider a fixed amount of interest, which is tied to the Bank of England base rate. 

When the base rate is higher, the rates of interest (or yield) offered by gilts also go up. This in turn pushes up annuity rates, as we've seen happen over the past couple of years.

The value of your pension

The size of your pension pot will be the main determining factor of how much income you'll get from an annuity. 

The more pension savings you use to buy an annuity, the more income you'll get. 

Age and life expectancy

Life expectancy is key to the annuity rate you are offered. 

The longer you're expected to live, the lower your rate, because the provider will be paying you for longer. For this reason, a 60-year-old will generally receive a lower income than a 70-year-old.

Your health

If you're in poor health, smoke or are overweight, you'll be expected to live for a shorter time, so you're likely to get a better annuity rate.

For this reason, it's important to declare any health conditions to your provider.

Your postcode

Annuity providers use your postcode to help calculate life expectancy. If you live in an area with a lower-than-average life expectancy, you may be offered a slightly higher rate.

What are enhanced annuity rates?

With some financial products - travel insurance, for example - you'll usually pay more if you have any health issues.

But with annuities, you can benefit from better rates. That's because you'll have a shorter life expectancy than someone in good health, meaning the annuity provider assumes they won't have to be making payments for as long. 

The more serious the condition, the higher the rate is likely to be. 

When we ran quotes in June 2025 for a 65-year-old with an initial pot of £100,000 looking for a single-life annuity (with no protection or index-linking), we were quoted incomes of between 6% (Legal & General) and 15% (Aviva) more for an enhanced annuity (based on an overweight smoker who is taking medication for high blood pressure and high cholesterol), compared with a standard annuity.

What are guaranteed annuity rates?

If you started your pension in the 1980s or 1990s, ask your provider to confirm whether you have a guaranteed annuity rate written into it.

If you do, you’ll be able to get a much more generous annuity rate compared to what’s on offer from the rest of the market.