Pension annuity sales hit record as average pot exceeds £80,000

The Guardian World

by Rupert Jones

February 14, 2026

AI-Generated Deep Dive Summary

Pension annuity sales have reached a record high, with industry data showing a significant rise in demand driven by changes to inheritance tax policies. The average amount invested in an annuity now exceeds £80,000 for the first time, reflecting a shift in retiree strategies. This surge is attributed to Rachel Reeves’s modifications to inheritance taxes, which have made annuities more attractive as a means of estate planning and wealth preservation. The renewed interest in annuities comes after years of them being overlooked by retirees, who previously favored other investment vehicles. The government's "inheritance tax raid" has altered the landscape, encouraging individuals to explore annuity options that were once less appealing. This policy change has not only boosted sales but also reshaped retirement planning strategies for many. The figures are impressive: annuity sales grew by 4% in 2025, reaching £7.4 billion. This growth underscores a broader trend where retirees are increasingly prioritizing stable income sources during their golden years. The rise in average investments highlights a growing confidence in annuities as a reliable financial tool. However, this shift has also sparked discussions about the suitability of annuities for all investors. While they offer security and guaranteed income, experts caution that they may not be the best fit for everyone. Financial advisors emphasize the importance of personalized advice to ensure retirees make informed decisions aligning with their individual needs and circumstances. This development holds significant implications for both personal finance and policy-making globally. As countries grapple with aging populations and the challenges of secure retirements, the UK's experience with annuity sales could serve as a model or cautionary tale for other nations. The evolution of annuities in the UK reflects broader trends in how societies adapt financial instruments to

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Originally published on The Guardian World on 2/14/2026