I want to access my pension

• With this option you can choose to take your 25% tax-free lump sum first and the other 75% which is taxable, remains invested for you.
• Any money you take after the first 25% may be subject to income tax. You can invest the rest in whichever fund or funds you choose, giving your money the chance to grow. Although as with all investments, it could go down in value too and you could get back less than you put in.
• To help you minimise the tax you pay, you can take the rest of your money whenever you like. So, for example, you can take it over a number of different tax years. This spreads it out, and if you do it this way it could help keep you in a lower tax bracket. And when you die, anything left over goes to whoever you have nominated to receive it. You might need to move into a different plan to choose this option. And remember that you don’t need to take any money at all if you don’t want to.

Learn more about taking tax-free money

Cash in your whole pension all at once

• You can take your whole pension pot in one go, as a lump sum. Normally the first 25% is tax-free, but on the remainder, you could lose 20%, 40% or even 45% to income tax, if it pushes you into a higher tax bracket (especially if you’re still earning). You’ll need to plan how you’ll provide an income for the rest of your life.

Take your cash in stages

• You can leave your money in your pension pot and take out cash lump sums whenever you need to – until it’s all gone, or you decide to do something else with what’s left. You decide when and how much to take out.
• With this option every time you take money from your pension, the first 25% is usually tax-free and the remainder may be subject to income tax. So you can’t take the full 25% tax-free from your pension pot at the start. But if you don’t need the 25% tax-free sum all at once, this may be another way to minimise the tax you pay when you access your money.
• With this option any money left in your pot can usually go to your loved one when you die.

Learn more about taking tax-free and taxable income

We can usually keep your money invested for you so it could grow, ready for when you decide to take it. If you don’t need your money yet, you should carefully consider this option.

If you’re still paying into a pension, you could carry on getting tax relief on your payments. You can get tax relief up to the amount of the Annual Allowance or 100% of your taxable salary, whichever is lower.

You might be able to keep guarantees or other features in your plan.

With this option, you can take tax-free cash (usually 25% of your pot), and the remainder is used to give you guaranteed regular income for the rest of your life. This income is taxed like a salary.

With this option, you can usually choose to leave a regular income to your loved one, but you can't normally leave a lump sum.

Learn more about a guaranteed income

If you don’t have any income coming in from anywhere else, you’ll need to make sure your money lasts to support you and your loved ones all the way through retirement, so you don’t run out.

If inflation goes up, your money might not stretch as far as it does today.

The amount you take out could be subject to Emergency Tax. You will have to claim back or pay any difference in tax to HMRC.

Tax will depend on your individual circumstances and rules can also change.

By increasing your income or taking a lump sum there will be less to leave behind to a loved one.

For example, with a Guaranteed income for life, they might use different criteria to assess you or your partner’s health and/or lifestyle conditions, this is often called an enhanced annuity. This might mean that you could get a higher level of income elsewhere. This is why it’s important to shop around – so that whatever you decide to do, it’s the right decision for you.

When deciding what to do with your pension pot you should be aware that different providers offer different products that may be more suited to your individual circumstances. Each product option could also have different tax implications. Their rates, investment funds, charges and terms may also be different.