Let’s face it—nobody wants to throw away money, especially not when it comes to something as crucial as your retirement income.
But that’s exactly what could be happening if you don’t shop around when buying an annuity.
New research reveals that many people over 50 could be losing out on hundreds of pounds a year simply because they stick with the first offer they see—or worse, the same provider they’ve always used.
Too Many People Are Sticking With Their Original Providers
According to findings from financial services firm Just Group, more than a third of over-50s who bought an annuity in the past four years didn’t even look elsewhere—they just accepted the deal from their current pension provider.
Another third admitted they never compared rates at all.
That’s a costly mistake. Annuity rates can vary significantly between companies, and the gap between the best and worst deals has only grown in recent years.
The truth is, staying loyal could be costing you big time.
Why Shopping Around Really Pays Off
Here’s the good news: annuity rates are actually on the rise.
Thanks to things like inflation, shifts in government policy, and high gilt yields, providers are offering better deals than they were even a few years ago.
And yet, many people still aren’t taking advantage of this upward trend.
In fact, data from Hargreaves Lansdown’s annuity search tool showed that in April, a 65-year-old with a £100,000 pension pot could secure a yearly income of up to £7,882 from a single life annuity.
That’s a 63% increase compared to what was available five years ago.
That kind of jump is not just a small win—it’s a serious boost to retirement income.
Your Health and Lifestyle Could Unlock a Higher Rate
Here’s something else most people don’t realize: you’re not always stuck with the rate you see advertised.
If you have certain health conditions or lifestyle factors—like being a smoker or having high blood pressure—you might actually qualify for an enhanced annuity.
But, shockingly, three out of four people aged 50–69 who plan to tap into their pensions in the next two years had no idea that this was even a thing.
Disclosing your medical history and lifestyle habits might feel personal, but in this case, it could literally pay off for the rest of your life.
Experts Say It’s Like Turning Down Free Money
Stephen Lowe, group communications director at Just Group, put it plainly: people who don’t shop around are essentially saying “no thanks” to free money.
“Too many zombie buyers are just accepting what they’re offered without exploring better options,” he said.
Over a full retirement, that could mean thousands of pounds missed out on—money that could have been used for holidays, family, or simply peace of mind.
There’s a Revival Happening in the Annuity Market
Once seen as outdated or even shady, annuities are enjoying a comeback.
Helen Morrissey from Hargreaves Lansdown said that recent rate increases have helped breathe new life into a market that was “on the brink of extinction.”
Last year was a record one for annuity sales—and with today’s rates, that momentum is only continuing.
Don’t Go It Alone—Help Is Out There
If you’re feeling overwhelmed by all the options, you’re not alone.
Luckily, there are plenty of free and trustworthy tools to help.
The government-backed MoneyHelper website offers an independent annuity comparison tool.
You can also check with annuity brokers or financial advisers, who can help tailor your search to your specific needs.
Different Types of Annuities to Consider
Most people go for a fixed annuity that pays out the same amount every year. But that’s not the only option.
Some prefer an annuity with inflation protection, which starts lower but grows with the cost of living—helping your income keep pace over time.
Others spread their risk by purchasing several smaller annuities throughout retirement.
Do Your Homework Before You Commit
Annuities aren’t something to rush into. They’re long-term commitments that can have a major impact on your quality of life for decades.
That’s why it’s crucial to understand the pros and cons before locking anything in.
Think of it like buying a house: you wouldn’t sign the first offer you saw without comparing prices, right? The same logic applies here.
Bottom Line: Shop Smart, Live Better
With rates up, opportunities wider, and tools readily available, there’s no excuse not to do your homework when it comes to annuities.
Shopping around and sharing personal health details could mean hundreds—if not thousands—more in your pocket over the years.
So before you settle for whatever your provider offers, take a step back.
Compare, ask questions, and make sure you’re getting the best deal possible. Your future self will thank you.