Pension Release Information
Pension release is a method of taking the Tax Free Cash from your pension (usually 25% of the fund value) and leaving the remaining fund invested until you chose to retire or take income from your pension. Currently you have to be over age 50 to do this. In the year 2010 the age at which you can do Pension Release increases to 55.
How much could I receive?
This depends on a number of factors including the size of fund and your objectives. We will always identify the maximum benefits you are entitled to. In the majority of cases, 25% of the transfer value of your pension can be released as a tax-free lump sum. However, it is important to plan for your retirement and our specialist advisers will provide investment advice for the remainder of your fund, ensuring the best options are available to you.
It is important to note that investments may not grow sufficiently to provide the benefits expected at normal retirement age.
Who can benefit?
In 2010, the minimum age for pension release increases from 50 to 55. Could this change in legislation affect you?
Do I have to retire to receive a lump sum?
No - you can continue to work, there is no need to retire. However, it is not possible to arrange for funds to be released from your current employer’s scheme where you are still eligible to make contributions.
How does it work?
Pension schemes can prove extremely complicated and difficult to understand. Your own pension fund is unique to you. Therefore full details of your existing pension arrangements need to be obtained by our Adviser Support team.
Unless your current pension plan is able to release your benefits directly to you, it maybe necessary to transfer the pension fund to a new plan in order to release these benefits early. This could take time and could incur penalty charges.
One of our qualified pension specialists will contact you to obtain a detailed understanding of your personal objectives and circumstances, before explaining the options available to you, in addition to the advantages and disadvantages of releasing benefits from your pension now.
The adviser will then make a suitable recommendation, which will be sent to you in a comprehensive report detailing the advice given, the tax free lump sum available, the charges and fees and what the long term effect will be to your pension income at retirement.
Should you decide to proceed, we will arrange for your tax free lump sum to be paid directly to you as soon as possible, usually 8-10 weeks after the advice process. If required, the Adviser Support team will then arrange the implementation of the appropriate investment solution for the remainder of your fund.
How long does it take?
This depends on two factors. The first being how quickly we can obtain up to date information from your pension company, in addition to them releasing the funds if you decide to proceed. The second is how quickly you return the required questionnaire forms to us during the process. We will keep you informed of approximate timescales as your case progresses. Pension release is not a quick fix to a short term financial problem.
