Annuity income from a £400,000 pot — options multiply at this level.

A £400,000 pot gives you significant flexibility in structuring retirement income. A single life level annuity at 65 might produce around £25,600-£28,000 per year — over £2,200 per month. Combined with the state pension, total income exceeds £37,000, meeting the PLSA comfortable standard. However, annuitising the entire pot may not be optimal at this size. Many retirees with £400,000+ use a layered approach: annuitise enough to cover fixed costs (perhaps £150,000-£200,000), keep the rest in drawdown, and take the 25% tax-free cash (£100,000) upfront or in stages via UFPLS. The tax position requires planning — £28,000 annuity income plus £11,502 state pension puts you well into the 20% band, with total income approaching the higher-rate threshold. Phasing your annuity purchase over several years can sometimes improve the overall rate.