The new pension freedoms take centre stage in April. Investors aged 55 or over will be able to take as much of their pension as they wish, either as an income or a lump sum. 25% will normally be tax free and the rest taxed as income.
What are investors planning? How do they intend to use the new freedoms? We recently asked some clients and the results are below.
Very few plan to take their pension as cash in one go – doing so could trigger a large tax bill. Most will continue to see their pension as a way of creating a retirement income. The freedoms will give them more control and flexibility over how much they take and when.
Survey results: How do you plan to take your pension?
No news or research item is a personal recommendation to deal. All investments can fall as well as rise in value so you could get back less than you invest.
HL survey October 2014, 213 respondents
The problem facing investors
Some large pension providers have admitted they will be unable to offer the new freedoms immediately. Investors wanting to benefit will have to wait or consider whether transferring to another provider could be more beneficial. Our Vantage SIPP will offer the new freedoms. It is already integrated with an income drawdown facility and makes it easy to manage both investments and income levels. From April, our clients over 55 will be able to take as much of their pension as they wish.
How to transfer to the Vantage SIPP
The Vantage SIPP is for people who want to make their own investment decisions. Before applying, investors should read our Terms & Conditions and Key Features (including the Important Investment Notes, Transfer Checklist and Common Transfer Declaration) and ensure they won't lose valuable guarantees or benefits or incur excessive exit fees.
The value of investments can go down in value as well as up, so you could get back less than you invest. It is therefore important that you understand the risks and commitments. This website is not personal advice based on your circumstances. So you can make informed decisions for yourself we aim to provide you with the best information, best service and best prices. If you are unsure about the suitability of an investment please contact us for advice.