If you want to ensure a guaranteed income in retirement that continues payments to your partner after you pass away, a joint life annuity could be what you're looking for. Here we’ll explain what a joint life annuity is, how it works, the key rules, and where to find the best joint life annuity rates in the UK.
What is a joint life annuity?
It’s a type of pension annuity for couples that continues paying income after the first person dies. Instead of payments stopping when the original annuity holder passes away, the income continues to a second person, usually a spouse, civil partner, or long-term partner.
This makes joint life annuities a popular option for couples who want to ensure the surviving partner continues to receive a reliable income in retirement. When you buy the annuity, you also get to choose how much of the income should continue after the first death.
How do they work?
A joint life annuity is purchased using some (or all) of your pension pot, typically when you reach retirement age. In exchange for this lump sum, an insurance or pension provider pays you a guaranteed income for life.
When setting up the joint life annuity, you’ll normally choose the percentage of income that continues to the surviving partner. Your options are typically 50%, 66%, or 100% of the original annuity payments.
So, with a joint life annuity, the payments continue in two stages:
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First, the annuity pays income to the annuity holder while both partners are alive.
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When the first partner dies, the surviving partner continues to receive a reduced or full income (depending on the chosen structure).
Joint life annuity rules
Joint life annuities follow the same core rules that apply to other UK pension annuities:
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You can normally buy an annuity from age 55 (rising to 57 from April 2028), once you begin accessing your pension savings.
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The income you receive from an annuity is normally taxed as regular income based on your marginal income tax rate.
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Once an annuity is purchased, it’s usually irreversible. This means you cannot change the structure, beneficiaries, or payment level later on.
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Up to 25% of your pension pot can usually be taken as a tax-free lump sum before purchasing the annuity, subject to the Lump Sum Allowance (LSA).
Because joint life annuities involve two lives and multiple configuration options, it’s important to choose the structure carefully before committing.
Why use joint life annuities?
It’s a pension product primarily used by couples who want to ensure long-term financial security for the surviving partner in the event of the other's death. Here are the key benefits:
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Predictability: One of the biggest advantages is certainty. The annuity guarantees income payments regardless of how long either partner lives, which can make your retirement budgeting more straightforward.
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Protection: Another benefit is financial protection for the surviving spouse or partner. Without a joint life arrangement, annuity payments would normally stop when the original policyholder dies, potentially leaving the surviving partner with reduced (or no) income.
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Extra features: Joint life annuities can also be combined with other features such as index-linked inflation rises, guarantee periods, or value protection - giving couples flexibility to structure the income in a way that suits your retirement plans.
What to expect with UK joint life annuity rates
The joint life annuity rate you qualify for and the level of income you receive depend on several factors, including:
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Your age and your partner’s age, along with health and lifestyle factors
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The percentage of income that continues to the surviving partner
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The provider you approach to purchase the joint life annuity
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Current interest rates, gilt yields, and the wider annuity market
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Optional features such as guarantee periods or payment increases
Speaking with an independent pension adviser is the easiest way to compare the best joint life annuity rates across all providers.
If you’d like to compare all your current joint life annuity rates and discover the best rates available to suit your specific situation, you can start with a free, no obligation chat with an FCA-regulated expert adviser below.
Get impartial annuity advice
Single life or joint life annuity?
One of the main decisions you’ll face is whether to choose a single life structure or a joint life structure.
A single life annuity pays income only while the annuity holder is alive, while a joint life annuity continues payments to a surviving partner after the first death.
Here’s how they single life vs joint life annuities typically compare:
|
Feature |
Joint life annuity |
Single life annuity |
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Who gets payments |
The annuity holder first, then the surviving partner |
The annuity holder only |
|
Payments after first death |
Surviving partner continues receiving income |
Payments usually stop (without spousal benefit) |
|
Starting income |
Usually lower |
Typically higher |
|
Financial protection |
Provides ongoing income for the partner |
Usually no survivor income |
|
Best suited for |
Retired couples |
Single retirees |
Because the income is designed to last for two lifetimes, joint life annuities usually start with a slightly lower income than comparable single life annuities.
It’s also worth bearing in mind that the higher the continuation percentage chosen for the surviving partner, the lower the starting income will typically be. However, the flipside is valuable and lasting financial protection.
Joint life annuity providers
Several major insurers in the UK offer annuity products that can be structured as joint life annuities.
Some examples of popular providers that may offer joint life annuity products include:
Not every provider offers the same joint life annuity rates or features. And if you want to maximise the potential income for your specific circumstances, it’s crucial to shop around and review all your options first.
Get 100% independent pension annuity advice today
Choosing the right joint life annuity structure is one of the most important retirement decisions you’ll make.
Because annuities are usually irreversible and rates vary across providers, carefully comparing your options with expert guidance can make a significant difference to your long-term retirement income.
Here’s why people trust Money Helpdesk for annuity advice:
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Access to independent, FCA-regulated pension advisers
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Whole-of-market comparison of joint life annuity options
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Personalised retirement income planning for couples
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Free initial consultation with no obligation to proceed further
If you’d like help comparing joint life annuities and finding the best joint life annuity rates available, you can arrange a chat with a qualified pension adviser here.
FAQs
It’s essentially the same thing as a joint life annuity. A joint life with last survivor annuity continues paying income until both people covered by the annuity have died.
After the first death, the surviving partner receives the agreed continuation percentage of the income and then payments stop once both individuals have passed away.