Taking some of your pension pot as an income, and leaving the rest invested
If you want to leave your pension pot invested, while being able to take money out when you need it, then this option might be right for you.
Leaving your pension pot invested means it still has the chance to grow. But it also means you need to make sure your money lasts. If your investments perform well, you might get a bigger income than an annuity would give you. But if your investments perform badly, you could end up with less money to live on.
If you want to take some of your pot as income and leave the rest invested, you can take up to 25% as a tax-free lump sum and take an income when you want. You’ll need to pay tax on any income you take.
We don’t offer this kind of plan. So if you’re interested, you’ll need to shop around to find a provider that does, then transfer your pension pot to them. If you transfer your pot, you could lose valuable benefits, so it’s important to check what you’d be giving up. You could also be charged a fee to move your money.
Make the right choice for you – taking some of your pot as income, and leaving the rest invested
If you’re like most people, the money in your pension pot will need to last for the rest of your life. And once you’ve made a decision, you might not be able to change your mind. So it’s important to get all the information you need to feel confident that you’re making the right decision for you.
For impartial guidance, get in touch with Pension Wise. It’s a free service set up by the government. Pension Wise can’t tell you what to do with your money, but they can give you more information about how the different types of pension work, and what to look out for with taxes and fees. You can get information online at www.pensionwise.gov.uk or phone 030 0330 1001 to talk to someone or to book a face-to-face appointment.
We can give you general information about the kinds of questions you might want to think about. But for advice that’s specific to you, you’ll need to talk to a financial adviser. We’d always recommend you talk to one before making any big decisions about your money. You can find a financial adviser at www.unbiased.co.uk. They’ll probably charge you for their time.