Unlimited access to Pension Funds

Old_Slaphead

On TV all the pension 'experts' seems to be suggesting that people over qualifying age (55 or 57) will have unfettered access to all their accumulated pension funds.

For those with amounts above £30k I understand that there's still a prerequisite of having £12,000 of 'secure' income - though no-one has highlighted this.

This basically can be made up of state pension (for those of SPA) and/or other pensions and annuties.

For those without an employers DB pension, presumably we will still need to buy an annuity to bring annual income up to the required level before access to rest of funds is available.

Am I correct in my understanding ?

(Apologies if this has been discussed on one of other threads which I may have missed)

atush

That is a stop gap measure (the 12K income rule). It will be unfettered completely in April 2015.

So you don't have to buy an annuity, just wait. If you go for a DD pot in the meantime, the GAD rate is now 150 until apr 15.

Can you wait for one more year or not? That is really the question. I would, and whack as much into the pension in the next year you can. If you earn 40K, put the lot in and live off savings this year.

charliehell

Old_Slaphead wrote: »

On TV all the pension 'experts' seems to be suggesting that people over qualifying age (55 or 57) will have unfettered access to all their accumulated pension funds.

Where does this 57 age come from?

Proxy

charliehell wrote: »

Where does this 57 age come from?

The proposal is that in 2028 the minimum age for taking benefits with be 57.

sandsy

charliehell wrote: »

Where does this 57 age come from?

From 2028, the minimum age for taking pension benefits will rise from 55 to 57.

Steveswift

Morning,


I am 55 in May, and have a 20K private pension pot from a previous job years ago which I can't get access to as a lump.


So if I read this right


At the moment i can take £5k (25%) of pot but HAVE to buy an annuity with the remaining £15K,but if I wait until Apr15 I can get the full $20k?


Steve

Steveswift

BTW I also have an Army pension and a teaching pension which can kick in at 55 ( Army one has too). These combined if I was careful of amount of lump I took would just about give me the 12k a year needed on the above mentioned scheme.

OldBeanz

Steve the £12k income limit applies only until April 2015. From that date the amount is £0 and you will not be stopped from contributing to other pensions which is another requirement of flexible drawdown at the moment.

kidmugsy

Steveswift wrote: »

At the moment i can take £5k (25%) of pot but HAVE to buy an annuity with the remaining £15K,but if I wait until Apr15 I can get the full $20k?

Nobody has had to buy an annuity since 2011. Anyway, as the comments above point out, the trick is to distinguish the transitional arrangements for March 27th 2014 to April 5th 2015 from the long-term proposals, the latter being subject to consultation and then Parliamentary approval.

Update: "2011" must be wrong. 2006?

Old_Slaphead

atush wrote: »

That is a stop gap measure (the 12K income rule). It will be unfettered completely in April 2015.

So you don't have to buy an annuity, just wait. If you go for a DD pot in the meantime, the GAD rate is now 150 until apr 15.

Can you wait for one more year or not? That is really the question. I would, and whack as much into the pension in the next year you can. If you earn 40K, put the lot in and live off savings this year.

Thanks for clarifying that atush.

I can wait for years it's a matter of withdrawing funds over several years to avoid HRT

atush

Steveswift wrote: »

BTW I also have an Army pension and a teaching pension which can kick in at 55 ( Army one has too). These combined if I was careful of amount of lump I took would just about give me the 12k a year needed on the above mentioned scheme.

I would not take the teachers pension at 55 if it will be reduced. It is reduced by 5% a year, so that would be reduced by 25-50%. So i;d wait for that one with no reduction.


No, you dont have to use the 15K to buy an annuity, I'd wait til 2015 and take out the rest over time then.