Can I take money out of my personal pension?

Is there a particular age I can take money out of my personal pension? Is it fixed at state retirement age or can I take cash anytime?

Question asked by Kay Rivers
Are You Pension Happy?
Call us on 02084327334
I know how much my pension is worth
I know how much my pension costs
I have clear financial goals for my retirement

Answered by Andrew Jenkinson

If you haven’t yet reached the age of 55, you usually won’t be able to take any money out of your pension. If you try to take money out of your pension before this age great care needs to be taken as there could be a 55% tax charge.

If you are aged 55 or over and have a defined contribution pension, otherwise known as a money purchase scheme, you will be able to cash in as much of your pension as you want to. This is sometimes known as pension release.

Tax on Personal Pensions

However, you should consider the tax consequences and the effect on your retirement income if you deplete your pension fund too quickly. It is often possible to take up to 25% tax free but anything in excess of this would be taxed at your marginal rate of income tax.

If you are aged over 55 and your pension is a defined benefit or ‘final salary’ scheme, it is unlikely that you can cash in your pension (unless the pension income is relatively small). It may be possible to transfer to a defined contribution scheme and take cash from there, although this isn’t right for everyone. Getting pensions advice is essential to make sure this approach works for you.

If you are at all unsure what to do, please contact us for pensions planning advice specific to your current situation from one of our qualified Financial Advisers.

pension drawdown
 
retirement planning
 
pension freedom
 
annuity
 
This information does not constitute financial or other professional advice. You should consult your professional adviser or contact us directly on 02084327333 should you require financial advice. It is important to ensure any insurance policy you take out is suitable for your needs.
Start your journey today...
  Find out how a Drewberry financial adviser can help you reach your destination by making the most of your finances.
Call us on 

Frequently Asked Pensions Advice Questions

 
I’m not in very good health and will struggle to continue working. A friend mentioned there are...
 
Back in 2013 I decided to draw down my pension to fund my retirement. However, the new income drawdown...
 
I’m looking into buying a retirement annuity with my pension pot and one of the options that keeps...
 
I’m worried that if the company I work for were to go bust or run into financial difficulty, I...
Need Help? Live chat now and get an instant answer from our Experts...

Neil
Pensions

Victoria
Insurance
Our Latest Reviews
Jane Essex
22/06/2019

Impressed with how personable and straight forward the conversations were. Would definitely recommend to others.

Natasha Caversan Mucci
09/06/2019

Extremely satisfied with the help and advice from Drew, since the beginning him understood what I was looking for and had the patience to help me out with all my questions and doubts. Didn’t try to be pushy or annoying calling me all the time like so many did before. At the end we found the perfect medical policy for me and my daughter that covers everything that we need. I more than recommend them and if in the future I need something else for sure I will contact them again. Giving only 5 stars because I can’t give 6!!!!

Gurdeep Sembi
29/05/2019

Egle was brilliant in guiding us through the options available for relevant life insurance, took care of all the paperwork and presenting suitable options to us and deciphering all the jargon for us. Highly recommended!

We are rated 4.9/5 based on 2274 independent client reviews.
To read more of our independent client reviews click here →
REVIEWS
EXCELLENT
4.92 / 5 Average
2274 Reviews
M singh
Overall Rating
I am so pleased with the service and I would like to thanks James for finding me the cheap and best insurance for me he was very helpful thank you again
M Nela
Overall Rating
Very professional job, good communication, effective. Happy with Nadeem’s work. Thanks you.
T Chuku
Overall Rating
A pleasure to speak to and a very professional, informative team. Welldone
M Nasim - Telappliant Ltd
Overall Rating
They took care of everything. Took all the legwork out of it and presented information in a way that made decision making easy.
J Edginton
Overall Rating
I would have to say our requirements had its challenges but all the way through Drewberry's service was responsive and professional.