Cashing in dB and DC pensions at 55

douglw

My total in both pensions is around 170,000 , I am no longer working and unsure if I am making the right decision. Thank you 

Brie

You can't cash in a DB pension (normally).  You could start to receive it as income.  And you are likely to be able to receive a tax free lump sum but you'll need to find out what that might be. 

You could cash in the DC pension and likely receive 25% tax free but the balance would be taxed at your normal tax rate or higher depending on your overall income for the year.  

Are you unable to work?  Claiming benefits?  There may be a big impact on any income or savings related you receive.  

QrizB

douglw said:

My total in both pensions is around 170,000 , I am no longer working and unsure if I am making the right decision. Thank you 

Your pensions have to last you for the rest of your life.

How much per year do you expect to need for an acceptable standard of life?

What will your DB pay out, and at what age?

What's the current value of your DC?

Do you habrany other ongoing income streams?

Are you expecting to receive a full State Pension when you reach 67?

https://www.gov.uk/check-state-pension

dunstonh

douglw said:

My total in both pensions is around 170,000 , I am no longer working and unsure if I am making the right decision. Thank you 

Almost certainly not but thankfully there are requirements in place that stop you making bad mistakes with DB pensions.  Not so much with DC pensions though.

You say its £170k.   
You will lose around £50k in tax and charges leaving you around £120k.    What spending needs do you have that require you to spend £120k in one go?

Dazed_and_C0nfused

I wonder if what the op really means is they are planning on cashing in their DC pension and putting the DB one into payment 🤔

douglw

First of all apologies for being so green and of little knowledge regarding pensions but from my paperwork it states full defined benefit £53,000 and estimated defined benefit transfer value £113,000 and at the bottom total estimated transfer value value 166,000 . I am 56 in a few months and am looking at getting my hands on a substantial amount for house repairs and clearing outstanding debts . The £166.000 is written as total benefits transferred to another pension arrangement and I'm unsure of what that actually means . I really don't want to make a big mistake that costs me but really need as much cash as I can possibly get with the least tax . Thank you 

dunstonh

Duplicate thread:  Cashing in dB and DC pensions at 55 — MoneySavingExpert Forum

please can a moderator combine the threads

QrizB

OP wrote elsethread:

First of all apologies for being so green and of little knowledge regarding pensions but from my paperwork it states full defined benefit £53,000 and estimated defined benefit transfer value £113,000 and at the bottom total estimated transfer value value 166,000 . I am 56 in a few months and am looking at getting my hands on a substantial amount for house repairs and clearing outstanding debts . The £166.000 is written as total benefits transferred to another pension arrangement and I'm unsure of what that actually means . I really don't want to make a big mistake that costs me but really need as much cash as I can possibly get with the least tax . Thank you 

It sounds as though you have a pension that's part Defined Benefit (the £113k part?) and part Defined Contribution (the £53k part?).

Did you have a public-sector employer? Can you tell us who they were?

douglw

The company was aerospace 

Ayr_Rage

@douglw PLEASE reply to you current topic and not open a new one for your answer.

Stick to one topic and add info if necessary.

Keep it all here

https://forums.moneysavingexpert.com/discussion/6618836/cashing-in-db-and-dc-pensions-at-55#latest

DRS1

Not sure why the OP creates a new thread for every post but the answer to @QrizB's question is aerospace.  BAE?

OP there is a debt board if you have debt issues.  Taking a pension as a lump sum to pay off debt is probably NOT a good idea.  Though that may depend on who is collecting the debt.