Accessing Pensions

Reaching the point where you can take your pension is a big milestone, but it comes with some of the most important financial decisions you will ever make. Once money is out of a pension, it usually cannot be put back – so it pays to get it right first time.

When can you take your pension?

You can normally access a personal or workplace defined contribution pension from age 55. This minimum age rises to 57 from April 2028. Your State Pension is paid separately, from State Pension age.

The main choices

Take some tax-free cash. Usually up to a quarter of your pension can be taken tax-free, subject to an overall limit. You do not have to take it all at once.

Draw a flexible income. With drawdown, your pension stays invested and you choose how much to take and when. It offers flexibility, but your income is not guaranteed and depends on how your investments perform.

Buy a guaranteed income. An annuity pays a set income for life or for a fixed number of years, however long you live or markets behave.

Mix and match. Many people combine these, using guaranteed income for essential spending and drawdown for everything else.

Common questions I help with

• How much can I afford to take each year without running out?
• Should I take my tax-free cash now or leave it invested?
• Which pensions or savings should I draw on first to keep my tax bill down?
• Is an annuity worth considering at today’s rates?
• How will the April 2027 inheritance tax changes affect what I leave behind?

A plan you can rely on

Using cashflow modelling, I will show you how your income, savings and spending are likely to play out over the years ahead, and how your plan would stand up if markets fall or you live longer than expected. I meet clients at my office at Fairways Business Park in Livingston or by video call, and work with people across Livingston, West Lothian and Edinburgh.

Please note: I do not advise on defined benefit (final salary) pension schemes.