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Once you reach 55*, you can take your pension savings if you want to. You can also leave your money invested and wait until you’re ready.
Considerations
Leaving your pension savings invested for now might be the right option for you if you’re still considering your options or have other income to rely on for the time being.
Here are three things to ask yourself when you’re making your decision:
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How much longer will I want to be investing my pension savings?
How you invest your money now will depend on how you want to take it in the future. If you’re thinking of taking your money in a few years’ time, are you invested in the right place?
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Do I know what option I might want to take at retirement?
How you want to take your pension savings can have an impact on how you invest your money and for how much longer. Make sure you understand your options and the things to consider now.
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Do I want to keep building up pension savings?
Do you want to make more contributions to your pension pot, and build up your money for retirement that way, or are you looking to rely on your investments to grow your money or protect it from market falls?
Remember: if you take your money as flexible income or cash later down the line, from that point onwards, your annual allowance (the amount you can pay into a pension each year without a possible tax charge) will change. You’ll have a specific annual allowance in respect of your money purchase pension savings (the ‘money purchase’ annual allowance or MPAA), of £10,000 (unless you have already taken benefits through Capped Drawdown). You can find out more about tax and your pension here
*the normal minimum pension age will increase to 57 from 6 April 2028 in line with changing legislation.