Is there any way to access pension early

longwalks1

Theoretically of course.
Aside from critical illness, is there any way at all to access a private SIPP before the age of 57 (for someone who is 49 currently).
Asking for a colleague, who has more than they need to retire now, but cant draw it for another 8 years (unless the government up the age limit again)

Is there any scenario at all that would allow them access some of it?

TheSpectator

In short, no.

Marcon

longwalks1 said:

Theoretically of course.
Aside from critical illness, is there any way at all to access a private SIPP before the age of 57 (for someone who is 49 currently).
Asking for a colleague, who has more than they need to retire now, but cant draw it for another 8 years (unless the government up the age limit again)

Is there any scenario at all that would allow them access some of it?

You don't have to be critically ill but you would need to have medical evidence that you qualify for ill health early retirement, in which case there is no lower age limit at which this can be paid. Hopefully (for all the right reasons) that doesn't apply here.

Currently an inherited SIPP can be accessed at any age, just in case that's relevant?

hugheskevi

Although you cannot access the pension directly, it might be possible to borrow and repay the debt using the pension at age 57.

A mortgage would be an obvious way to do that, although there could be complications around justifying what funds would be used for, and that you do not foresee changes to income in the future.

longwalks1

Marcon said:

You don't have to be critically ill but you would need to have medical evidence that you qualify for ill health early retirement, in which case there is no lower age limit at which this can be paid. Hopefully (for all the right reasons) that doesn't apply here.

Currently an inherited SIPP can be accessed at any age, just in case that's relevant?

Sadly its not an inherited SIPP, its a self funded and grown one.  Sorry yes, I meant to say about ill health retirement, bit of a grey area I guess depending on an individuals condition and medical professional they deal with

longwalks1

hugheskevi said:

Although you cannot access the pension directly, it might be possible to borrow and repay the debt using the pension at age 57.

A mortgage would be an obvious way to do that, although there could be complications around justifying what funds would be used for, and that you do not foresee changes to income in the future.

Yes, another option to look into.
He was even considering marrying his long term partner (of 25 years) and then divorcing and agreeing to hand over half the SIPP as settlement

theoretica

My understanding is that you can often access a SIPP early - but face considerable taxation to do so. 

eskbanker

longwalks1 said:

Aside from critical illness, is there any way at all to access a private SIPP before the age of 57 (for someone who is 49 currently).
Asking for a colleague, who has more than they need to retire now, but cant draw it for another 8 years (unless the government up the age limit again)

Were they advised to commit so much into inaccessible form, in the knowledge of a desire for very early retirement, or have circumstances changed unexpectedly?  Just wondering if there's the potential for action against an adviser?

longwalks1

eskbanker said:

Were they advised to commit so much into inaccessible form, in the knowledge of a desire for very early retirement, or have circumstances changed unexpectedly?  Just wondering if there's the potential for action against an adviser?

Thank you eskbanker. No, they weren’t advised to save too much, they were lucky with an old, deferred DB pension transfer and several years of growth since.  

A fortunate/unfortunate situation to be in at the same time.

Nebulous2

longwalks1 said:

eskbanker said:

Were they advised to commit so much into inaccessible form, in the knowledge of a desire for very early retirement, or have circumstances changed unexpectedly?  Just wondering if there's the potential for action against an adviser?

Thank you eskbanker. No, they weren’t advised to save too much, they were lucky with an old, deferred DB pension transfer and several years of growth since.  

A fortunate/unfortunate situation to be in at the same time.

Most people who want to retire very early will have funds outside their pension to bridge the gap until they can access their pension. 

Using an ISA would be popular.

You can over a shortish period use debt such as credit cards but 8 years is a long time to juggle that. 

Are there any substantial assets, such as equity in a home, that could be used? 

Marcon

longwalks1 said:

hugheskevi said:

Although you cannot access the pension directly, it might be possible to borrow and repay the debt using the pension at age 57.

A mortgage would be an obvious way to do that, although there could be complications around justifying what funds would be used for, and that you do not foresee changes to income in the future.

Yes, another option to look into.
He was even considering marrying his long term partner (of 25 years) and then divorcing and agreeing to hand over half the SIPP as settlement

Two things to keep in mind: you cannot pledge your pension as security for a loan (@hugheskevi isn't suggesting that, but in case anyone reads it that way...); and the divorce route wouldn't accomplish much unless the partner is already aged at least 55.