Pension freedoms is a piece of legislation introduced by the government in 2015. It allows you to withdraw your pension in more ways than previously possible from the age of 55.
From the age of 55, you can:
Releasing pension money early isn’t right for everyone as it will leave you worse off in retirement.
Before the introduction of pension freedoms, people looking to retire early only had the option to buy an annuity which gave them a regular guaranteed income. Now, you have greater flexibility when it comes to withdrawing your savings and can do so in a way that works best for you.
The great flexibility offered with pension freedoms is welcomed by many. But with this flexibility comes a number of challenges. So, when withdrawing your pension, it’s important to be aware that:
This is why so many people are turning to financial advisers to help them with their pension. We can help you withdraw your pension in the best way while avoiding these challenges.
Final salary pensions come with a number of valuable benefits, such as a guaranteed income for life from a set age. Due to the way this type of pension works, you are not able to withdraw your money in the same way you could a defined contribution pension.
To take advantage of pension freedoms with a final salary pension, you would first need to transfer your funds to a new, modern pension scheme. Doing so does mean giving up your guaranteed benefits, which for most people is not the best thing to do. That’s why you should speak with a financial adviser before making any decisions. And if your pension is worth £30,000 or more, then by law you have to take this route.
We can help you make the best possible decisions when it comes to your pensions. We are authorised and regulated by the Financial Conduct Authority.