A growing divide between retirement expectations and financial reality is emerging across the UK. New findings indicate that more than a third of adults aged 50 and over want a steady and stable income in retirement, yet many remain unsure about how to secure it. In response, L&G has launched an educational initiative aimed at improving public understanding of annuities, which remain one of the few ways to guarantee income for life.

Survey results highlight misconceptions

The company’s Annuities Explained YouTube series follows the UK’s first National Annuities Day held in October 2025. The event, supported by Legal and General, Aviva and Standard Life and led by Pension Potential, revealed widespread confusion about retirement income products. A YouGov survey of 2,058 adults aged over 50 conducted between 9th and 12th September 2025 showed that while 35% want stable income in retirement, 38% of adults lack confidence about their later life finances.

Women are particularly affected. Only 13% understand that annuities can include inflation protection compared with 26% of men. This feature is important for long term security, yet many remain unaware of its role. Although 52% of women prioritise comfort and freedom in retirement, few recognise annuities as a route to achieving this. Steve Butler, managing director of Pension Potential and founder of National Annuities Day, said the findings show a “clear mismatch between what people want in retirement and what they understand about how to achieve it.”

Wider research shows long term risks

Global data reinforce the concern. A 2025 report from State Street Global Advisors, based on responses from 4,371 defined contribution scheme members worldwide, found UK savers to be the most pessimistic internationally. Inflation, market uncertainty and lack of guidance were key issues. Phoenix Group’s work with Frontier Economics suggests that from 2025 to 2060, 54% of defined contribution savers will reach retirement as undersavers or financially struggling. The situation is expected to peak in the early 2040s when nearly three in five may fall short of the Pensions and Lifetime Savings Association’s minimum living standards. The government’s Analysis of Future Pension Incomes 2025 further warns that updated economic projections have reduced expected replacement rates by two percentage points.

Legal and General launches educational series

Against this backdrop, Legal and General has introduced a six part video series designed to clarify how annuities work. The videos follow Barry, a pre retiree, as he speaks with annuities expert John Graves about common questions. Topics include:

• What an annuity is and how it converts a pension pot into guaranteed lifetime income
• The types of annuity available including single life, joint life and index linked options
• The differences between annuities and drawdown, including the security of guaranteed income and the risks of fund depletion in volatile markets
• How UK annuity rates are determined. As of 10 November 2025, MoneyHelper data indicate that a healthy 65 year old with a pension pot of £100,000 could receive about £7,665 each year through a single life level annuity. Rates have risen from 4.5% in early 2022 due to higher interest rates and gilt yields
• How providers calculate annuity rates through assessments of life expectancy, lifestyle factors and potential enhancements. Conditions such as smoking or high blood pressure can raise rates by 6 to 15%
• How to purchase an annuity, including steps from obtaining quotes to submitting an application and the availability of free services such as Pension Wise and the Annuity Ready comparison tool

John Graves, head of technical and regulatory for retail annuities at Legal and General, said: “Better retirement outcomes begin with better understanding. When people are informed, they are empowered to make choices that reflect their needs and values. We are passionate about helping people navigate their options with clarity, so they can build a retirement that feels secure and sustainable. These videos can improve customer understanding of annuities and help them to decide if they form part of a retirement solution for them.”

Growing interest but continued gaps

The new series arrives as annuity sales continue to rise. Sales increased 34% to £7 billion in 2024, although uptake remains limited due to low awareness. Legal and General, founded in 1836, now manages £1.1 trillion in assets as of FY24 with 44% international exposure. Its retail business serves 12.4 million customers. In the first half of 2025, workplace pensions generated £4 billion in net flows for 5.6 million members and retail annuity sales reached £745 million.

Many savers remain at risk of undersaving. Research from Unbiased shows that 57% of adults are not on track for retirement. Industry analysts believe that greater accessibility to guidance, including Legal and General’s video series, could help bridge this gap. The full set of videos is available on the company’s YouTube channel along with tools and calculators on its campaign page.