Pension Lump Sum....What do people do with it?

IAMIAM

Just curious, what do people actually do with their lump sum when retired at age 55+, a few of my friends have said they will use it to buy house in cash after 30 years of renting! Wondered what people tend to do with it.....saving it seems pointless 

Dox

The smart money is increasingly on not taking the maximum tax free cash unless there is an obvious use for it.

atush

We will be taking it monthly, in that our withdrawals each month will be taxed only on the 75%

burner03

put it in the Halifax Everday Saver account 

83705628

If you don't need the cash, if you don't need to take it as a lump sum then... why?

dunstonh

Just curious, what do people actually do with their lump sum when retired at age 55+,

Sensible people dont take it unless they have a justifiable reason for doing so.

Using it for phased flexi-access drawdown is very popular.

green_man

atush said:

We will be taking it monthly, in that our withdrawals each month will be taxed only on the 75%

^^ This

Taking the lump sum just reduces the monthly amount you get for the rest of your life, so unless you have a good, necessary use for it (or tax treatment looks like changing) then its best left invested with the rest of your pot IMO.

Stubod

..wine, women, fast cars,and then just waste the rest......

...I'll get my coat...

NB If you are in the earlier NHS scheme you have to take a lump sum whether you want it or not.....just sayin'...

rickenbacker330

I’ve just taken the max at 55 from my final salary pension. Given that the commutation rate was 48.4 and the pension that I sacrificed would have been taxed at 40% it seemed an easy choice. My plan is to use the LS to add flexibility to my income so that I have more available between 55 and 67 (when SP kicks in). 

Mick-H

Premium bonds, you'll not lose money and chance of winning a million.
With average luck they reckon 1.4% interest.

Sea_Shell

DH plans to take max tax free lump sum from DC pension, reinvest it in our ISAs, then just draw his Personal Allowance via drawdown.

We calculate that he should just about get the whole lot out tax free, in the 10 years before other pensions come into play.