Archived article: This article was correct at the time of publishing. Tax, investments and pension rules can change over time so the information below may not be current.

What are your options at retirement?

These are exciting times for pensions – with the new rules coming into effect next month, people will soon have unlimited access to their pensions when they retire. The reforms have been welcomed by the public since they were confirmed in the Autumn Statement, and with 6 April now just a few weeks away many people are debating exactly how they will take an income when they retire.

Lee Dooley Lee Dooley
13 March 2015

Unlimited access to your pension from 6 April

The good news is that you have plenty of options. The new freedom means that you could technically withdraw your entire pension as a single lump sum, but your pension should last your whole retirement so most people are likely to stick to only taking their 25% tax-free cash.

You are no longer required to buy an annuity with the remaining 75% of your pension, although they remain an excellent option for people seeking a guaranteed income for life. You should compare annuity rates to find the best deal before making a purchase, and you may also get a better deal by applying for an enhanced annuity – which bases your level of income on your lifestyle choices and health condition.

Annuities offer the security of a guaranteed income but with no flexibility or control. This is why many people choose to combine an annuity with drawdown – where your pension stays invested and you take a regular income from it directly. The good news is that from 6 April drawdown will be available to everyone, although you will need a pension like the Best SIPP that allows it.

Our new At Retirement service

We’ve launched a comprehensive At Retirement service to help people with their options at this important stage of life. Whether you are 10 years from retiring or have already done so, we can give you all the information, tools and support you need to make the most of the pension reforms and achieve the retirement lifestyle you want and deserve.

Our At Retirement service gives you access to:

  • New, competitive drawdown pricing for people looking to stay invested at retirement
  • Our multi-award winning Best SIPP, with annual management charges of 0.3% or lower*
  • A powerful online annuity planner provided by annuity experts Just Retirement Solutions **
  • Free guides and web articles covering the new pension rules and your options at retirement

Free guide to your retirement options

You can find out more about the pension changes and your options at retirement by downloading this free guide. We cover your 25% tax-free cash, the pros and cons of annuities and drawdown, and how you can stay invested at retirement with our multi-award winning Best SIPP account.

If you are unsure of your options you should seek professional financial advice or visit Pensionwise.gov.uk. SIPPs are not suitable for everyone. If you don’t want to invest across different asset classes or don’t think you will make use of the investment choices that SIPPs give you then a SIPP might not be right for you. Self-directed investors should regularly review their SIPP portfolio, or seek professional advice, to ensure that the underlying investments remain in line with their pension objectives. Prevailing tax rates and reliefs are dependent on your individual circumstances and are subject to change.

*Other fees apply.

** This is a restricted service and not a whole of market solution. You may be able to find a better rate by looking elsewhere or contacting providers directly. Just Retirement Solutions will use your information to provide the annuity comparison service to you for the purpose of obtaining quotes from annuity providers. Once set up, an annuity cannot normally be changed or cancelled. Therefore it is important to consider all of your options, especially in light of the new pension reforms.