When should I get pension advice?

Chances are, as defined contribution pensions are the most common type of pension, you’ll have plenty of decisions to make as you approach retirement, including how to convert your retirement savings into an income that will last for the rest of your life. Given the enormity of this decision, it may be worthwhile seeking professional financial advice to understand the best options for you.

Before the introduction of pension freedoms, you would almost certainly have used the money in your pension to buy an annuity, or income for life, after perhaps taking your 25% tax-free cash lump sum. This guaranteed you’d be paid a certain income, with the amount received depending on a range of factors such as your age and health.

However, following the rule changes, as you approach retirement you’ll need to decide how you’re going to produce an income from your pension savings that can be used to replace your salary when you reduce your working hours, or stop work completely. There are more options than ever, including flexi-drawdown, buying an annuity and taking cash lump sums. Some are more complicated than others, and deciding on the right one for you can feel overwhelming. Read more in our article Your pension options at retirement.

The Government’s Pension Wise service, run by the Pensions Advisory Service and Citizens Advice, provides people aged 50 and above with free guidance on their pension choices at retirement. You can give them a call on 0800 138 3944 to book a free appointment, or you can book one via their website.

It’s always worth taking advantage of a free appointment with Pension Wise, however if you want advice that’s tailored to you specifically, you’ll also need to speak to a financial advisor, as Pension Wise can only provide general guidance and not individual recommendations. In this case, our guides How to find the right financial advisor for you and How to get advice on your pension might be helpful.

If you’d like to speak with a pensions expert, Rest Less Pensions are offering a free Pension Health Check with one of their experts. There’s no obligation, but once you’ve had your review, they will discuss whether you would benefit from paying for financial advice. Capital at risk.

Author: wpadmin

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