Thu 04 February 2010
There is no time to lose if you are planning on taking your pension benefits before the age of 55. Currently you can take benefits from the age of 50, but from 6th April this will rise to 55. However you are likely to be disappointed if you leave it until the last minute to apply because you will probably have to transfer your pension first, and that takes time.
There are two main ways you can draw your private pension benefits. The first is through an annuity, the second is through an income drawdown plan. The latter allows you to leave the remainder of the pension fund invested after taking your tax-free cash. We think most under 55s seeking to take their benefits before the rule change will do so via a drawdown plan for that reason. Some may decide to lock into the secure income of an annuity, though this is likely to strike many investors as a fairly unattractive option at such a relatively young age.
you can get up to 30% more income by shopping around for your annuity...
Getting the best deal will typically mean transferring your pension in either case. Many pension providers do not offer drawdown plans, and those who do often charge an arm and a leg for them. Likewise you can get up to 30% more income by shopping around for your annuity rather than simply taking the one offered by your pension provider.
The upshot of all this is that you should allow time to transfer your pension if you have decided to take benefits before the 5th April. This process normally takes a few weeks, however some pension providers make a habit of dragging their heels when it comes to transferring money out.
We can help out here. We offer both a low cost income drawdown plan and an annuity supermarket that you can use for free. We will mercilessly badger your pension provider until they transfer the money out as part of both services. We can’t guarantee that as a result the money will arrive in time, but we will do our utmost to try and ensure it does.
Getting the best deal will typically mean transferring your pension ...
By far the most effective way to give yourself the best chance of transferring your pension on time is to apply now. There are just over 2 months until the rule change. Most transfers will easily be completed in this time with a minimum of fuss, but why take the chance? Five years is a long time to regret not completing a form just a couple of weeks earlier.
Download your free guide to Income Drawdown & ASP
See how much income you could receive from an annuity with our free online annuity search engine
There are two main ways you can draw your private pension benefits. The first is through an annuity, the second is through an income drawdown plan. The latter allows you to leave the remainder of the pension fund invested after taking your tax-free cash. We think most under 55s seeking to take their benefits before the rule change will do so via a drawdown plan for that reason. Some may decide to lock into the secure income of an annuity, though this is likely to strike many investors as a fairly unattractive option at such a relatively young age.
you can get up to 30% more income by shopping around for your annuity...
The upshot of all this is that you should allow time to transfer your pension if you have decided to take benefits before the 5th April. This process normally takes a few weeks, however some pension providers make a habit of dragging their heels when it comes to transferring money out.
We can help out here. We offer both a low cost income drawdown plan and an annuity supermarket that you can use for free. We will mercilessly badger your pension provider until they transfer the money out as part of both services. We can’t guarantee that as a result the money will arrive in time, but we will do our utmost to try and ensure it does.
Getting the best deal will typically mean transferring your pension ...
By far the most effective way to give yourself the best chance of transferring your pension on time is to apply now. There are just over 2 months until the rule change. Most transfers will easily be completed in this time with a minimum of fuss, but why take the chance? Five years is a long time to regret not completing a form just a couple of weeks earlier.
Download your free guide to Income Drawdown & ASP
See how much income you could receive from an annuity with our free online annuity search engine
