DURING & POST
Getting hold of your money
On retirement, you may need to get hold of your money from a variety of sources.
State pension
You don’t get this automatically: you have to claim it.
You should receive a letter four months before you
reach state pension age telling you how to go about
this. If you don’t, call the state pension claim line on
0800 731 7898.
Personal pension
New rules introduced in April 2015 mean you can
access and use your personal pension pot in any way
you wish from the age of 55. Up to 25 per cent is
normally tax-free and the rest is taxed as income.
SIPP investments
You’re free to take out SIPP investments from the age
of 55, but you should speak to your provider first.
Flexi access drawdown
With flexi-access drawdown (FAD), when you come to
take your pension, you reinvest your pot into funds
designed to provide you with a regular retirement
income. This income may vary depending on the
fund’s performance and it isn’t guaranteed for life.
Annuities
A lifetime annuity is a type of retirement income
product that you buy with some or all of your pension
pot. It guarantees a regular retirement income for life.
Lifetime annuity options and features vary. You can
also cash it in at a later date.
Capped drawdown
This is a form of income withdrawal where you receive
money directly from the funds in your pension
scheme. Within certain limits, you can choose how
much of your pension you receive each year.
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Property
Equity release enables you to get your hands on part
of the cash tied up in your bricks and mortar to pay
off debts and also boost your everyday spending
power while still being able to live in your home. You
can do this either with a lump sum, or by drawing
down smaller amounts. The amount you owe is
usually cleared from the proceeds of the house when
you die or move into long-term care.
Key points
If all your money is invested, you will either
need to sell assets or ensure you are
receiving an income from them
Leave as much money as you can invested so
that it can grow. Holding large amounts of
cash may limit growth opportunities
Check you are receiving the state pension, as
it is not automatically paid when you retire