What sort of income should I expect from a pension pot of £330,000?

12 April 2022

Question by Harry

I am 63 in September, I retired last September, I have a pension pot of £330,000 at the moment, what sort of income should I expect from this amount? I am not taking a lump sum.


Answered by Boring Money

Hi Harry,

If you want to convert your pension into a guaranteed income for life - an annuity - then the amount you can get will depend on what type of features you want to include e.g. a spouses pension upon your death; inflation proofing etc.

As an example, if you opt for a single life, level annuity with no guarantees then you can expect approximately £16,500.

If you have any health issues, then the income you can expect is likely to be higher.

There is also the drawdown option, which is where instead of selecting a guaranteed income for life, you take what you need from the pension as and when you want to.

I would suggest you look at this from the other angle i.e. rather than saying what can I expect as an income, you ask yourself how much you need/want from it, and then you find the best solution to meet your needs/wants. We would normally do this using lifetime cashflow modelling sofrware.

I hope that helps!

Josh

Answered by

Boring Money