Annuity incomes have surged in value to a 16-year high, according to the latest data from Hargreaves Lansdown’s annuity search engine.

According to the tracker, a 65-year-old with a £100,000 pension can now get up to £7,639 per year from a single life level annuity with a five-year guarantee – the highest amount since December 2008, when a man of the same age could get £7,646 pa.

Annuity rates hit a record low after the Brexit vote in 2016, before rising interest rates saw annuity incomes surge, reaching £7,586 after the mini-budget in 2022.

Whilst it was generally anticipated that annuity rates would fall in 2024, as interest rates and gilt yields were expected to drop, expectations were defied, and it proved to be another highly fruitful year for annuity customers.

According to the Association of British Insurers, annuity sales hit £7bn last year, reaching a ten-year high, and this momentum has continued into 2025.

Hargreaves Lansdown head of retirement analysis, Helen Morrissey, said the data revealed a “reversal of fortune for a market that many thought had been all but killed off by a combination of rock-bottom interest rates and the Freedom and Choice reforms.”

“Rising interest rates have seen incomes climb in recent years, and people’s interest has risen along with them,” she added.

However, Morrisey advised caution when shopping for an annuity.

“You need to consider your options carefully. Once bought, an annuity cannot be unwound, so if you act in haste, you may find you are repenting at leisure if you don’t get the right type of product for your needs,” she warned.

Therefore, Hargreaves Lansdown highlighted five key tips for annuity shoppers: Shop around, consider your circumstances, give all your health details, consider the impact of inflation, and don’t put all your eggs in one basket.

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