Pension flexibility explained

You have flexibility when it comes to accessing your money from your pension at retirement. You should consider your options carefully and choose the one that best suits your plans for retirement. You should also shop around to make sure you get the best deal.

Currently, you can access your pension savings from age 55.

How can you take your money?

You can take cash from your pension savings whenever you want. The first 25% is normally tax free with the rest being taxed as income.

When taking cash from your pension, you should consider, do you really need it now? You may not be making the most of available tax benefits and you need to make sure your money lasts the length of your retirement.

You can choose to take a flexible income, which means using your pension savings to provide a regular income that you can change or stop, at any time. You can dip in and make cash withdrawals at any time too.

Your money stays invested, giving your pension savings the potential to grow, which might help your money last longer. Remember, investments can go down in value as well as up and you might get back less than was paid in.

It’s also important that you keep an eye on how much you take out and what’s left, as your income will stop if your money runs out. Any remaining pension savings may be passed on to your loved ones when you die.

Or, you could choose to buy a guaranteed income for life – also known as an annuity.

Special features can be added to this to meet your needs - such as providing for a loved one when you die. You should consider this carefully because you won’t be able to change providers, cash it in or add special features once it’s set up.

Your pension income is not automatically passed on when you die unless you’ve chosen this as an option.

You may even want to mix and match your choices to suit your plans for retirement.

How can you find out more about these options and which one may suit you?

Visit our website standardlife.co.uk for more information on the different ways in which you can take your money. Use our retirement pathfinder - a quick and easy tool that allows you to explore these different options to see which one may be for you.

How can you find out if you are on track for the lifestyle you want in retirement?

Our handy “how much will I need in retirement?” guide will give you an idea of how much money you'll need to fund your lifestyle, and our retirement calculator will show you how much you are likely to get back based on your retirement savings.

You can register for online servicing to manage your pension online and download the Standard Life app to keep track of your savings on the go. We are here to support you, every step on the way.