Your money in retirement

At the moment, when you reach age 55, you'll be able to access your pension savings, even if you're still working. This is increasing to age 57 from the 6th of April 2028.

So, whenever the time feels right for you, you'll find three main ways to enjoy the money you've saved.

Option one - take it all as cash:

You can have all your pension savings paid in one lump sum.

However, if you're planning to use this money to live on, you'll need to make sure it lasts for as long as you need it to.

You may also be able to take some smaller cash payments and spread them over a number of years. Any savings left in your plan will stay invested and aim to grow.

Either way, you should bear in mind that taking large sums of money from your pension savings could push you into a higher tax bracket. This means you'd need to pay more tax.

Option two - get flexible access to your savings:

If you want more control over the money you've saved, you can keep it invested in your plan while you gradually take the income you need.

As your money stays invested, it aims to grow.

But there’s a risk if your investments don't do well, or if you live longer than expected, your savings could run out earlier than you'd like.

Option three - buy a secure income:

You can turn your pension savings into a regular income - this is also called buying an annuity.

You give some or all of your pension savings to an insurance company, and in return they'll pay you a guaranteed regular income for the rest of your life.

Before going down this route, you'll need to be sure it suits your needs.

Because once you’ve bought a secure income, you won't be able to change your mind.

You can combine any of your three options.

And whatever you decide to do, you can usually take up to a quarter of your pension savings completely tax free.

Of course, there's no rush to do anything. You can leave your savings where they are until whenever you're ready.

To find out more about your retirement options, talk to your financial adviser, or visit royallondon.com/retirement

At the moment, from age 55, you can turn your pension savings into a regular income that’ll keep going for as long as you do. This is also called ‘buying an annuity’. This is increasing to age 57 from the 6th of April 2028.

You give some or all of your pension savings to an insurance company and, in return, they'll pay you a guaranteed, regular income every year for the rest of your life. You can also combine taking a secure income with your other retirement options.

You can choose to add extra features such as yearly increases to your money or making sure your loved ones will get some of your income when you die. It costs more to add on certain features, so your starting level of income will be less.

Before buying a secure income, you can usually take up to 25% of your pension savings as a tax-free lump sum.

Things to watch out for:

With this option you need to get things right the first time.

That's because once things are up and running, you won't be able to add extra features or change your mind – even if your circumstances do.

If you'd like to pass anything onto your loved ones, you'll need to make sure it's been agreed up front otherwise your income will usually stop when you die.

Before buying a secure income, you should shop around to find the best deal, it might just give you more money in your pocket.

To find out more about your retirement options, talk to your financial adviser, or visit royallondon.com/retirement

At the moment, from age 55, you can choose to take your pension savings as a cash payment. This is increasing to age 57 from the 6th of April 2028.

This could be all in one go or spread over a series of smaller lump sums.

The first 25% of each cash payment will be paid tax free, while the rest will be taxed as income at your normal rate.

Any money you leave behind will stay invested in your plan and aim to grow.

If at any time your needs change, you can use the rest of your pension savings to take a flexible income or to buy a regular secure income that'll be paid for the rest of your life.

When you die, any savings you have left in your plan can be passed on to your loved ones.

Things to watch out for:

If you take your pension savings as cash, your money isn't guaranteed to last forever. So if you don't manage your income carefully, it could run out before you die.

Taking large sums of money out of your plan could push you into a higher rate tax bracket, meaning you'd need to pay more tax on your pension savings.

To find out more about your retirement options, talk to your financial adviser, or visit royallondon.com/retirement

At the moment, from age 55, you can enjoy flexible access to your pension savings. This is increasing to age 57 from the 6th of April 2028.

You can set up a regular income or simply take some cash whenever you need it. The rest of your money will stay invested in your plan and aim to grow.

Usually, the first 25% of any money you take out of your plan will be paid tax free.

You can choose to take all your tax-free cash in one go or spread it out over a series of smaller payments.

When you die, any savings you have left can be passed on to your loved ones.

Things to watch out for:

With flexible access, there's a risk your money could run out earlier than you'd like, so you'll need to manage your income carefully.

If at any time you need more certainty you can always choose to buy a regular, secure income that'll be paid for the rest of your life.

To find out more about your retirement options, talk to your financial adviser, or visit royallondon.com/retirement