Annuity vs Drawdown UK: Which Is Right for You?

An annuity converts pension money into a guaranteed income for life; drawdown keeps the pot invested and you withdraw flexibly

Annuity rates have improved sharply in recent years - a 65-year-old can now buy ~6.5% annual income for life from a level annuity

Drawdown offers flexibility and inheritance but exposes you to sequence-of-returns risk and longevity risk

A hybrid approach (annuity covers essentials, drawdown covers discretionary) often produces better outcomes than picking one