Downside of taking the 25% lump sum from a pension early?

wjr4

It’ll be in your estate for inheritance tax purposes 

prowla

Some pension schemes won't let you take out the 25% and keep it running; rather you have to shift them to a new scheme.

cloud_dog

Did you post something similar not so long ago, or am I misremembering?

Many years ago we decided to use our pension to repay our interest only mortgage by taking the 25% TFLS.  And we are very comfortable with the approach and how this has worked out for us, but for us it is a case now of pretty much taking the 25% TFLS to repay the mortgage.

The oxymoron is that now we are approaching that stage, I am really wishing I could retain my TFLS cake and eat it by utilising UFPLS for our actual ongoing pension income drawdown. 

So, as others have said, unless you have a need to take all of the TFLS you really should reconsider if that is the best option for you.

RiskyScientist

Yes we all know that politicians keep their promises 

JoeCrystal

RiskyScientist said:

Yes we all know that politicians keep their promises 

Careful! We do not want to wade into the dangerous water of political debate!!! 

On a more serious note, the posters should stop speculating about potential future changes and focus on what is best for them. However, sometimes the financially best choice is not necessarily the best decision mentally and vice versa

westv

JoeCrystal said:

RiskyScientist said:

Yes we all know that politicians keep their promises 

Careful! We do not want to wade into the dangerous water of political debate!!! 

On a more serious note, the posters should stop speculating about potential future changes and focus on what is best for them. However, sometimes the financially best choice is not necessarily the best decision mentally and vice versa

There will be plenty more speculation up until the October budget.