Planning For Retirement And Pension Opportunities

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Planning for retirement and pension opportunities


Shelby Michael

This blog explains retirement options should you have saved or are saving for your pension in a money purchase pension scheme like:

*A personal pension.

*A stakeholder pension.

*A group personal pension plan arranged by your employer.

*A retirement annuity contract – (a personal pension sold before 1988 when personal pensions were first available).

*A free-standing additional voluntary contribution (FSAVC) scheme.

There is a number of retirement options to choose from your pension savings, including:


*Phased retirement.

*A lifetime, fixed term or enhanced annuity.

*Income drawdown.

When the full worth of your whole pension funds isn\’t more than 18k, you may take it as a monetary lump sum in place of an income. This is known as trivial commutation and you must be at least sixty to do this.

Key points

You can decide when to switch your own money purchase pension investment in to cash flow, you don\’t need to cease working to accomplish this. You can\’t typically alter your personal pension investments to a pension source of income before you are fifty five. You are able to usually receive 25 percent of your pension account in cash, for a tax-free lump sum and the balance is applied to purchase an income, that is taxed.


A lifetime annuity pays source of income for the rest of your lifetime. An enhanced annuity comes with a higher level of revenue to take into account any medical concerns you may have. A fixed term annuity gives an income for a fixed period of time with the option to take a look at your needs at the end of this term.

For those who have several pension policies, you might have a better revenue by integrating them, although you aren\’t required to make use of them all all at once.

Annuity rates take account of the simple fact of which some individuals live longer than other people. Those who live longer than average are going to take more of their annuity than, for instance, someone who passes away a few years after retiring.

Phased retirement

This can be a valuable financial planning tool, for example if you want to slow down gradually on work and begin to replace your income with pension income. It also supplies further flexible help for your heirs if you pass on. The part of the fund you have never converted to annuities can pay a pension or a single payment to your surviving dependants, depending on the terms of the pension plan. You don\’t need to buy an annuity with your pension pot at retirement, you might contemplate postponing buying an annuity till a future date or choose not to acquire an annuity whatsoever and pull an income straight from your pension pot as an alternative. In the event you hold off buying an annuity you may expect a higher annuity rate due to the fact you\’re older but this may be risky to imagine that annuity rates will be much higher if you delay buying your annuity.

Also you can delay getting your state Pension, in return for obtaining a higher pension or a taxed lump sum when you retire.

Income withdrawal

This lets you pull an income from the pension fund while leaving it invested. There\’s two kinds:

*Capped drawdown, when there are limits on the amount you are able to take.

*Flexible drawdown, where there is no limits provided you are able to show you possess additional income of a specific level called the Minimum Income Requirement.

Income withdrawal is an option in which you begin to attract an income from just part of your pension fund on a single date, allowing the remainder of the fund intact.

Ideas to help you shop around for an annuity

Allowing for about six weeks to obtain quotes prior to when you want to acquire your annuity is advisable, and with all of the retirement available options, it is important to make the proper decision, and you ought to think about seeking Independent financial advice through a qualified independent financial adviser (IFA).

Practical facts about pension help and pension plans if you do not desire to be working for your whole life –

pension plans


pension plans

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