What is retirement?

Have I got enough to retire?

It's important to think about how much money you'll need before you decide when to retire. Will you want a new car now and then? Will you want to dine out with friends? What about holidays and hobbies?

We can help you figure out what your costs might be on our calculator.

Use our Retirement Calculator today

Could I choose to be semi-retired?

Not everyone can afford to stop work altogether, when they get older. Not everyone wants to. These days, you can work less and take money from your pension to top up your income. If you decide this is right for you, there are different ways can you take money from your pension.

It's important to think about how the money you take from your pension is taxed. The first 25% of your pension pot is tax-free so it won't affect your tax bill. Anything you take after this may be subject to tax.

Taking money from your pension can impact how much you can pay into your pension in the future. This is called the annual allowance and you can read our guide on how it works here.

The State Pension

The current State Pension age is 66 (subject to change) and it’s worth £175.20 a week for the 2020/2021 tax year. The amount you actually get will depend on your National Insurance record.

Read our guide on the State Pension.

If you have a ‘defined contribution’ pension

These are pensions where the amount you get depends on how much has been paid into your pension and how the investments perform. If you want to find out more, read our Pension Basics guide.

All personal and most workplace pensions are ‘defined contribution’ plans. If you have one of these, you can usually start taking money from your pension after you reach age 55.

You don’t have to take your money at 55. You can still live off another source of income, like your job. You can keep paying into your pension until you have enough to retire.

If you have a defined contribution pension, your money is usually invested so it has the potential to grow but this is not guaranteed. The value can go down as well as up and you could get back less than you paid in. Usually, 25% of what you take out is tax-free. The rest may be subject to tax.

If you have a 'defined benefit' pension

These are workplace pensions. If you have one of these, it will give you a guaranteed income based on factors such as the number of years you stayed with your employer. If you want to find out more, read our Pension Basics guide.

These types of pensions will start paying out based on their scheme rules. You need to get in touch with your employer or the scheme manager to find out when it will start paying you.