You can normally take 25% of your pension savings tax free from the age of 55. However, you don’t have to take it then and you also don’t have to take it all at once.

You may have seen the value of your pension savings, and therefore your tax-free amount, fall, so if you don’t need the money now then maybe stop and think before you withdraw it.

Delaying taking your tax-free lump sum(s) means your pension savings should have more chance to recover, and could mean that you get a larger amount when you do choose to take it. Taking money from your pension savings now may also mean that you won’t have the income you need in later life. If you have other savings, you may want to consider using these before accessing your pension savings.

If you do need to take money from your pension savings now, think about only taking what you really need to give the rest the best chance of increasing again when markets start to improve.

Before making any decisions about your pension savings or other investments, you can get free guidance from the government’s PensionWise service or you may want to consider speaking to a financial adviser. You can find one yourself at unbiased or you can also get financial advice from Standard Life. A financial adviser can work with you to build a tailored plan that’s tax efficient and resilient to ongoing market changes. There’s likely to be a cost for getting advice.

Did we answer your question today?

Yes No
Related FAQs