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Unlike some other pensions, Retirement Account offers a range of ways to take your pension when you retire.
Bear in mind that your circumstances can change and you may decide to defer your retirement which means you can leave your savings invested. When it comes to tax-free cash, the Governments tax rules may change too.
You may already have a good idea how you want to take your pension. It’s important to go back to basics and think about your situation before deciding. The decision should be based on a number of things including your age and health, if you plan to stop working altogether or just reduce your hours, whether you’ve got financial dependents and if you’re looking for a fixed or flexible income.
You need to consider how much you think you might need to spend in retirement and also think about whether you plan on using any savings or assets you have outside of the pension to help to pay for these. You might be considering downsizing your home for example.
To help you understand what income you will have in retirement you can find out if your eligible for and how much you might receive as part of the Basic State Pension, you can find out more about this here. Do remember that you won’t be able to take your State Pension until you’re in your mid to late 60’s.
Yes, you can pay into your pension even when you’ve started taking an income or taken some of it as a cash lump sum however you’ll only get tax relief on contributions of up to £4,000 a year*. This is known as the money purchase annual allowance.
*Please bear in mind tax rules may change in the future and may be different depending on where in the UK you are. Your own circumstances may also change, for instance the rate of tax you pay may alter.
If you’re in ill health you may be able to choose to take your pension benefits before age 55. If you are in serious ill health you may be able to take your whole pension pot as tax-free cash. Serious ill health means you have been diagnosed with less than 12 months to live.
If you plan to take money from your pension soon after you transfer to us, this is an important decision. As such, we’ll ask if you’ve had financial advice or Pension Wise guidance, or if you would like some before proceeding with your transfer.
What is financial advice?
This is what you’d get from a Financial Adviser. They’ll talk to you about what your finances look like today, and your plans for tomorrow and recommend the best products to suit your personal situation. They’ll normally charge you for their advice.
Find out more about financial advice or you can also get help to find an adviser through Scottish Widows
Who are Pension Wise?
Pension Wise from Moneyhelper, offers free and impartial guidance about your pension options. It’s a government service where you can get an appointment with a Pension Wise specialist, who will talk you through your options. Find out more about Pension Wise, by visiting the MoneyHelper website.
Halifax is a division of Bank of Scotland plc. Registered in Scotland No. SC327000. Registered Office: The Mound, Edinburgh EH1 1YZ. Bank of Scotland plc is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority under registration number 169628.
Eligible investments with us are protected by the Financial Services Compensation Scheme (FSCS). For further information about the compensation provided by the FSCS, refer to the FSCS website at www.fscs.org.uk/. You can also visit our Financial Services Compensation Scheme page for more details.