DOWNLOAD: A guide to your retirement options
Are you an expat with a UK Pension? This guide outlines the different options available to you from your pension funds when you retire. It also provides useful information about the state pension and the benefits available from workplace pensions your employer may have provided for you.
You may be aware that there have been a number of recent changes to the way in which you will be able to take your pension benefits. Please read this guide carefully as you consider the options available to you.
The options described in the guide generally apply to defined contribution (money purchase) pension pots such as personal pensions, group personal pensions, self-invested personal pensions (SIPPs), and stakeholder pensions. These options are not normally available to defined benefit/final salary pension schemes.
The choices you can make are:
Take some or all of your pension pot as a lump sum
Convert your pension pot into an annuity
Use drawdown pension, phased retirement or other retirement income products
You should also be aware that you need to take into account the risk factors in connection with your preferred means of accessing your pension fund and we will discuss these with you during our meeting. You are able to take as much or as little as you like from your defined contribution pension from age 55*.
Apart from the tax free cash element of the pension fund (usually 25%) any funds withdrawn will be added to your earned / pension income and taxed accordingly depending which income tax bands they fall into (if taxable, the tax rate could be 20%, 40% or 45% (or in Scotland 19%, 20%, 21%, 41% or 46%) or a combination of these rates depending on the amount withdrawn).
The government does not prescribe a particular product which you will need to purchase or invest in to access your pension savings. It will be up to you to decide how you want to access them, either as a lump sum or through some sort of financial product:
If you want greater control over your finances in the short term you will be able to extract all your pension savings in one go, and invest / spend them as you see fit. More details about how you will be able to access your pension in this way are covered in this guide.
Or If you want the security of an annuity you will be able to purchase one, either when you retire, or at a later stage. This may be with either some or all of your pension savings.
Or If you would prefer to keep your savings invested and access them over time, you will be able to purchase a flexi-access drawdown plan. There are no limits on the amount you can withdraw each year and more information as to how this works is covered in the guide.
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