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Your options from age 55

Deciding how to use the money in your Lifestyle Account will be a big decision. You'll want to be sure you're making the right choice for you and your family.

You can use the money in your Lifestyle Account at any time following your 55th birthday, whether or not you've stopped working.

You have flexibility over when, and how, to use the money in your Lifestyle Account.  There are a number of options which are explained in more detail below.  You can access the Retirement Planner in Manage Your Account to help you compare your options.

Pension Wise  has been set up by government to provide free and impartial guidance to help you understand what you can do with your Lifestyle Account.

OptionHow will I be taxed?

Cash
All as cash

You can take all of your Lifestyle Account as cash - either all in one go or as a small number of payments.

If you've already received 25% of your savings tax free, the rest of your cash will be subject to Income Tax, so you should consider carefully how much you take and when you take it (or you might pay a higher tax rate).

Read our example case study.

Up to 25% of it will be tax-free but the rest may be taxed as income.

Income Drawdown
A bit at a time - an income when you need it

You can access your Lifestyle Account in a way that suits you – either on a regular basis or as and when you like.

Income Drawdown therefore provides more flexibility but also more risk as your account will remain invested. It is important to understand that your money can run out and therefore careful management of your savings will be required.

The income you take will be subject to Income Tax if your overall annual income is above your Income Tax threshold.

Read our example case study

* Income Drawdown is not available within The Guardian Lifestyle Plan. You would need to transfer to a provider that offers this option.  This includes the Legal & General WorkSave Mastertrust (RAS) - Pension Access Scheme which is provided by Legal & General.

Up to 25% of it will be tax-free but the rest may be taxed as income.

Annuity
Regular guaranteed income (annuity)

You can choose to convert your Lifestyle Account into a regular income that you'll receive for the rest of your life. To do this you'll need to talk to an insurance company to buy an annuity. You do not have to purchase your annuity with Legal & General - you are free to choose the best value option at the time.

At retirement, we'll help you by providing details of how to 'shop around' to find the insurance company who will give you the best rates and explain how you can benefit from enhanced annuity rates where medical conditions exist. The regular money you receive from your annuity payments count as income so you'll have to pay tax if your overall annual income is above the Income Tax threshold.

Read our example case study.

Up to 25% of it will be tax-free. Each payment may be taxed as income.

You can choose more than one option and provider
You don't just have to choose one option or provider. You can mix and match your options for each Lifestyle Account you have.

Your state pension

Find out more about the state pension, where you can go for more information and how much you might get when you reach your state pension age.

Pension Wise

A free and impartial service backed by the government who will help you make ensure that the decisions you’re making are the right ones for you.

Investing as you approach retirement

The things to think about when it comes to investing your Lifestyle Account in the years leading up to retirement.

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