There’s a lot to consider when working out which option or combination best suits your financial requirements. You should select what will provide you with a dependable and tax-efficient income throughout your retirement.
Providing you have reached the age of 55, you can take the entire value of your pension pot as a cash sum to spend as you choose. The ability to do this can sound like a desirable option. But it is one that needs careful thought.
The complete independence of this option can be both part of its appeal and its risk. You need to ask yourself what your expectations are in retirement and if cashing in your money will provide you with enough income for your needs.
Things to think about
- You could run out of money – think carefully about what you intend to spend your money on and factor in necessities as well as leisure
- There’s no guaranteed income for life – take into consideration your health and lifestyle, as these will affect your life expectancy and how long you require your money to last