Story by Laura Purkess

i paper

A big concern I hear from those who want to gift money is the fear of leaving themselves short in later life. But that is exactly what annuities are there for, and now is actually a great time to buy one.

Annuities were unpopular for many years because low interest rates meant they offered relatively poor returns, but higher interest rates over the past few years have meant they offer vastly better value.

The average annuity rate was 7.62 per cent as of March 2026, according to insurer Standard Life. That means a healthy 65-year-old with a £100,000 pension pot can lock in a guaranteed annual income of up to £7,620.

With £300,000, you could generate £22,860 income annually – with the full new state pension, that’s an annual income of almost £35,000 a year.