Pension release

caslau

Hi, I need to raise around £5k urgently and was thinking of releasing part of my pension pot, do i have to do this through a company who specialises in this or is it something you can do for yourself (free of costs) if you can, any advice would be welcome. Thanks

jem16

caslau wrote: »

Hi, I need to raise around £5k urgently and was thinking of releasing part of my pension pot, do i have to do this through a company who specialises in this or is it something you can do for yourself (free of costs) if you can, any advice would be welcome. Thanks

There is no such thing as "pension release".

If you are age 55 or over then you can choose to take your pension with 25% tax free lump sum and the rest as an annuity or income drawdown.

Any attempt to access your pension before this age is illegal and likely to lead to the loss of a large amount of money from your pension and a large bill for tax on unauthorised payments from HMRC.

I suggest you try to find another way to raise £5k.

OldBeanz

If you are under 55 there is no way you can legally do this. If someone offers to do this for you then they will be breaking the law and will probably abscond with your pension. HMRC will then come and take the money back off you in penalties.
If you are over 55 then raising an amount like this may seriously dent your later lifestyle.

redbuzzard

FSA Pension Release warning

Sticky thread above

Pensions Regulator warning

jamesd

Companies that specialise in this are companies that specialise in scamming people. Like say not bothering to tell you that you will have to pay 55% of the amount taken as an unauthorised payment charge by HMRC in addition to their own fees.

If you tell us more about the urgent need and your general circumstances we may be able to come up with a legal solution instead.

caslau

Thanks for your replies, basically no one seems to think it is a good idea to take a sum of money from your pension, i am sixty years old and i thought i could legally get up to 25% of my pension just now as i really need it, i also understand that it will vastly reduce my pension when i retire but is there ANY reputable companies who do this or can i do it myself by contacting the people who run my pension?

jem16

caslau wrote: »

i am sixty years old and i thought i could legally get up to 25% of my pension just now as i really need it,

As you are 60 years old, then yes you can legally commence your pension. However that was not what you asked.

is there ANY reputable companies who do this or can i do it myself by contacting the people who run my pension?

You should contact an IFA who will get you the best deal possible and far better than your pension provider will offer.

Use https://www.unbiased.co.uk to search for an IFA in your area.

jamesd

At age 60 you may well have options to use the pension. Please tell us more about the pension - like whether it is a work one that pays out an amount related to your pay or one where you can pick individual investments. What is the pension called?

dunstonh

basically no one seems to think it is a good idea to take a sum of money from your pension

If it was pension liberation then no. Unlawful activity is not a good idea.

i am sixty years old and i thought i could legally get up to 25% of my pension just now as i really need it

And if you are prepared to rob your retirement years to get it early then that is your choice.

but is there ANY reputable companies who do this or can i do it myself by contacting the people who run my pension?

Any local IFA.

However, be prepared for the IFA to ask you why are you taking it at 60 and don't be surprised if they question you more on your finances. It would be expected that someone pension unlocking (taking benefits before retirement) would need a good reason for an IFA to recommend it. Spending on consumer goods, holiday etc would normally be considered a mis-sale and an IFA shouldnt recommend it. Getting out of debt could be a consideration but so can refinancing.