Using your pension

Things to consider before accessing your pension pot

It’s worth sitting down comfortably to carefully consider your options and what you want from your retirement

Transcript

Hi there! I’m Sanjay, and I’m here to chat about the different ways you can use your pension pot to give you an income in retirement.

From your 55^th birthday you can access your pension pot. If you need money straight away, you can take up to 25% as a tax-free lump sum. But then you’ll need to decide what to do with the rest.

You might already have some ideas about what your retirement will look like. But it all depends how much money is in your pension pot, and what sort of lifestyle you have in mind. Remember, you need to think about the long-term as your needs could change over time.

Your first step should be to check what benefits your pension provider offers that can’t be matched elsewhere.

Think carefully about the type of retirement you’d like. Do you want the security of a guaranteed income for life, or is flexibility more important to you?

You then need to research the different pension products available, any potential risks, and weigh them up against your ambitions for retirement. Remember, you might have to pay tax on your income, so think carefully about the tax implications of what you’re considering.

You can always ask for guidance from Pension Wise or an independent financial adviser, to help work out what’s best for you.

It’s important to shop around to help you understand all the different options that are available to you. Because while one retirement option might be right for someone like me, your needs may look completely different.

Voice over: If you'd like to find out how Legal and General could help you make the most of your retirement income, get in touch today.

Do you have more than one pension pot and have you got an idea of how much you have saved?
Are your pension savings enough to meet your retirement needs now and in the future?
Does your current pension provider offer you a Guaranteed Annuity Rate, a Guaranteed Minimum Pension, or any other valuable benefits? If they do, then it would be a good idea to look at these first to see what you would get.

Understand how much state pension you'll receive >

Have you thought about when you’d like to retire and what you’d like to spend more time doing?
Have you thought about what might happen as you get older and the help and support you might need?

It’s worth thinking about what level of certainty you’ll need around your regular income and what risk, if any, you're prepared to take with your money

See your options >

Your income in retirement will be taxable. It may be sensible to consider taking an income evenly across your retirement. Lump sums may be liable to income tax at a higher rate.

Find out more about tax in retirement >

Inheritance tax >

Guidance from Pension Wise >

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