pension tax free lump sum OR Not

Bertie1509

I would be pleased for feedback on my situation. I am 59 and need to make a decision on which option to take on my pension which I have decided to draw once 60 although I intend to continue working and earning for another 2 - 3 years. I have a company pension and now have the option of a) Taking a pension of £22,500 or b) Taking a pension of £14,300 and a tax free lump sum of £84,800.
I have an outstanding mortgage of £130k (30%) which I haven't been rushing to pay off as the interest rate is 1.5%. Instead my OH (just retired) and I have both been investing in Stocks/Shares ISAs. Would I be better to take the max lump sum to pay off of my mortgage or take the max pension.

I am airing towards taking the maximum pension, any thoughts please?

Bigmoney2

Work out how much you need to live on per annum and base your decision on that.

Also it isn't just a) or b), you can commute pension up to a maximum lump sum of 25%, so option b is the most lump sum you can take, but you could take a lower than maximum lump sum for example 20k and a pension somewhere between the 2 figures quoted.

If you intend to carry on working as well as drawing pension, be mindful of going into the 40% tax bracket, not sure at what level of income this kicks in at now but it was reduced in the last budget.