Your pension income options

• You can leave your money in your pension pot and take an income from it.
• You can take up to 25% as a tax-free lump sum straight away or in stages.
• Take withdrawals whenever you like, but income after the first 25% will be taxed as earnings.
• The rest of your money stays invested.
• You can choose how much to take and how often.
• If you take too much, or your investments underperform, you may not have enough left to live on in retirement.
• You can leave any funds you don’t withdraw to your family, beneficiaries or charities. If you die after you’re 75, your beneficiaries may have to pay tax on the money.

Read more about drawdown

• You can leave your money in your pension pot and take lump sums from it as and when you need.
• 25% of each lump sum will be tax free, 75% will be taxed as earnings – so you could move up a tax band.
• Take out as much as you want straight away and use it for whatever you want, but you’ll have to pay tax as above.
• The rest of your money stays invested.
• You can choose how much to take and how often.
• If you take too much, or your investments underperform, you may not have enough left to live on in retirement.
• You can leave any funds you don’t withdraw to your family, beneficiaries or charities. If you die after you’re 75, your beneficiaries may have to pay tax on the money.

Read more about taking lump sums

• You can move your pension to an insurance company who will provide you with a lifelong, regular income. This income will be taxed as earnings.
• You can take up to 25% as a tax-free lump sum before you set up your annuity.
• There are many types of annuities and features you can select, such as inflation protection and a spouse’s pension.
• With low interest rates, you may not get much income for your money.
• Provides you with a guaranteed income that will last as long as you live.
• You may be able to pass something on, depending on how you set up your annuity. If you die after you’re 75, your beneficiaries may have to pay tax on the money.

Read more about annuities