Any way to access my entire pension pot in my 30s?

HendrikSavoo

I am finished where I work. Been there for just over a year, part-time. Currently injured with a bad back and dont want to go back. I leave on good terms but the work is too stressful for me going forward (physically).

As I am short of money for the time being, I wish to take out all £1200 (lol big spender) of my employer pension plan. I understand 25% of it will be tax free, but A) how much tax will be on the other 75%, and is it even possible to withdraw all of the pension?

EDIT: I don't wish to transfer it to another scheme going forward. I want it to pay the bills.

JoeCrystal

Nope. Not until you are 55. Unless you are diagnosed with a terminal illness with less than 12 months to live.

sammyjammy

What kind of pension was it? Where I work if you have less than two years service you can withdraw your contributions but I absolutely wouldn't recommend it. What are you planning on living off when you retire?

NedS

Some schemes (normally DB/final salary schemes) may allow you to exit from the scheme if you've been a member for less than 2 years. What type of scheme is it? From what you've described it sounds like it's a DC scheme, not a DB scheme.


https://www.pensionsadvisoryservice.org.uk/about-pensions/when-things-change/leaving-your-pension-scheme/taking-a-refund

HendrikSavoo

@sammyjammy State Pension obviously.

HendrikSavoo

NedS wrote: »

Some schemes (normally DB/final salary schemes) may allow you to exit from the scheme if you've been a member for less than 2 years. What type of scheme is it? From what you've described it sounds like it's a DC scheme, not a DB scheme.


https://www.pensionsadvisoryservice.org.uk/about-pensions/when-things-change/leaving-your-pension-scheme/taking-a-refund

I am not sure exactly. My employer matches my monthly contribution. It is a Tesco Colleague Pension Plan thing.

Zanderman

HendrikSavoo wrote: »

I am finished where I work. Been there for just over a year, part-time. Currently injured with a bad back and dont want to go back. I leave on good terms but the work is too stressful for me going forward (physically).

As I am short of money for the time being, I wish to take out all £1200 (lol big spender) of my employer pension plan. I understand 25% of it will be tax free, but A) how much tax will be on the other 75%, and is it even possible to withdraw all of the pension?

sammyjammy wrote: »

What kind of pension was it? Where I work if you have less than two years service you can withdraw your contributions but I absolutely wouldn't recommend it. What are you planning on living off when you retire?

HendrikSavoo wrote: »

@sammyjammy State Pension obviously.

Re the 25% tax free - that's when you retire... Not when you're in your 30s. So you won't get that benefit.

Re reclaiming contributions - as others have said this may be possible if you've been there less than 2 years - but you may regret it in future - that 1200, invested in a pension fund, might be worth having in 30-40 years time. When you might be really short of cash and in real need. But just worth 1200 now. And maybe not even that - is the 1200 just your own contributions from payroll or your contributions plus the employer's ones?

(edited to add - and is 1200 the stated value at present - which will include your tax relief - which will be lost if you recover the contributions, so value would actually be 960, and how much of that was your contributions and how much was the employer's?))

Re your comment about living on state pension, I assume that's a joke? The way things are going the state pension may not be worth much by the time you're old enough to claim it. And the claiming age will be getting pushed further back. Could be 50 years before you get that. You will probably need another pension before then.

HendrikSavoo

Zanderman wrote: »

Re the 25% tax free - that's when you retire... Not when you're in your 30s. So you won't get that benefit.

Re reclaiming contributions - as others have said this may be possible if you've been there less than 2 years - but you may regret it in future - that 1200, invested in a pension fund, might be worth having in 30-40 years time. When you might be really short of cash and in real need. But just worth 1200 now. And maybe not even that - is the 1200 just your own contributions from payroll or your contributions plus the employer's ones?

(edited to add - and is 1200 the stated value at present - which will include your tax relief - which will be lost if you recover the contributions, so value would actually be 960, and how much of that was your contributions and how much was the employer's?))

Re your comment about living on state pension, I assume that's a joke? The way things are going the state pension may not be worth much by the time you're old enough to claim it. And the claiming age will be getting pushed further back. Could be 50 years before you get that. You will probably need another pension before then.

This is a DC scheme, but I am not aware what that means, nor what difference between it and a DB scheme.

The total 1200 is everything at present, including employer's contributions.

Zanderman

HendrikSavoo wrote: »

This is a DC scheme, but I am not aware what that means, nor what difference between it and a DB scheme.

The total 1200 is everything at present, including employer's contributions.

So, go ahead and ask your employer:

• can you opt out and get your contributions back (minus the tax relief)
• would the employers contributions be given to you too (which will also, I assume, have been increased by tax relief, which you won't get back)
• what would be the total value be

Bear in mind you wouldn't be taking your pension pot, just your contributions to it. The value of 1200 is the value of it when in the pension pot - i.e. the value of it as a contribution to your pension, not claimable until you're 55 by which time the 1200 value will have increased.

Taking the contributions back now, if indeed you can, is just that, taking the contributions back.

How much did you, personally, pay in? Tot that up and you might get a better feel for what you might get back..

NedS

HendrikSavoo wrote: »

This is a DC scheme, but I am not aware what that means, nor what difference between it and a DB scheme.

Sorry, as it's a DC (Defined Contributions) scheme, you will not be able to withdraw the funds before you retire (unless you are terminally ill).

crv1963

NedS wrote: »

Sorry, as it's a DC (Defined Contributions) scheme, you will not be able to withdraw the funds before you retire (unless you are terminally ill).

I would add that although you can't get it now you should retain the details of it and any paperwork you have for it. Forget about it/ don't worry about it. It will quietly grow in the background and your older self will appreciate it.

Mrs Crv put around 4000 into a pension in her 20s, stopped contributing to it, moved house etc, retained the original paperwork and now in her 50s has pleasantly learnt that it is worth around 96k! Not life changing but is going to enable her to retire before SPA.

Along with other various "pots" built over the years between us it is a useful sum. I'd advocate always join whatever pension scheme is on offer if the employer is also (and now by law they should) going to contribute- not doing so is creating your own pay cut.

All your little pots gathered over the years will help when you reach the age that you can access them.