- From April 2015 it will be much easier to access your pension pot - you will be able to take money out when and how you want. If you are 55 or over, you no longer have to pay 55% tax on everything you withdraw; the amount of tax you will pay will depend on the amount of other income you have in that year. Up to 25% of your pot will still be tax free.
- To help you make a decision on what to do with your pension, the government is setting up a free and impartial guidance service, Pension Wise. From April, you’ll be able to use the service online, or you will be able to book an appointment to speak to a trained specialist either over the phone, via The Pensions Advisory Service, or face to face, via Citizens Advice.
- The Pensions Wise website will be the first place to go for guidance. It contains information about the changes in pension laws and helps you understand what you need to think about before making a decision about your retirement. It will also tell you where to book an appointment with a guidance specialist if you would like more personalised information. Take a look for some information to get you thinking about April
- Your telephone or face-to-face guidance session will be tailored to your needs. The guidance specialist will consider any issues such as welfare, social care and any savings and debt you have and tell you what your pensions options are. If you want to have further information or regulated financial advice, you will be told where to look.
- The guidance will be impartial. This means that no one delivering it will try to sell you a financial product or recommend a particular pensions provider or firm.
- Before you attend your session you will need to be prepared and bring with you some key document (such as information on your pension pots).
- You’ll receive a record of all the information you covered in your guidance session. This will explain the options you explored, information on possible next steps, as well as suggesting more sources of guidance or specialist advice.
- All the pensions guidance specialists will be trained to a high standard. The Pensions Advisory Service is very highly regarded in the pensions industry for their extensive experience in providing pensions guidance and Citizens Advice is a leader in delivering guidance to people on many different issues.
- The design and content of the service is being constantly tested and improved to make sure that people find it as useful as possible.
- Using the guidance service will help avoid scams. The guidance will give you practical tips on how to handle a situation if you suspect a scam. For example, the guidance specialist will show you how to check whether a firm is regulated on the Financial Conduct Authority’s register and how to spot a fraudulent offer. The Pensions Regulator and the Financial Conduct Authority have also led their own campaigns on how to avoid pension scams – look on their websites for more top tips on how to spot if someone is trying to sell you an unregulated product.
Pension Wise will be first step to understanding your pension options.
But there are other places you can go for guidance too. For example, the independent Money Advice Service, which was set up by the government, has plenty of useful information on pensions.
The Pensions Advisory Service is a non-profit pensions guidance organisation that can help with any questions on company, personal and stakeholder schemes. It has a general helpline (0845 601 0806), one for women (0845 600 0806) and for the self-employed (0845 602 7021).
- Take your time to decide what to do with your retirement savings...pensionwise.gov.uk/pension-pot-options
- Shop around to make sure you get the best deal... pensionwise.gov.uk/shop-around
- Be aware of fees, charges and the tax implications of the different options... pensionwise.gov.uk/tax
- Beware of scams... pensionwise.gov.uk/scams
- Make sure your pension lasts as long as you do... pensionwise.gov.uk/making-money-last
- Find out about the new State Pension here. Plus 6 reasons why your pension could be the ultimate way to save!