How can I take my Personal Pension/SIPP? Your Retirement Income Options and Planning for your Retirement!
In this video I give an overview of some of the key ways you can take your Personal Pension or SIPP.
I highlight three of the main ways that you can take an income from your Pension and give real quoted examples that have been sourced from the open market.
I give an idea of the income that can be obtained using either Flexi-Access Drawdown, purchasing an Annuity or a Fixed Term Annuity.
The basis of the Annuity is assumed as follows: –
*Standard rate (not enhanced, the client has no medical/lifestyle factors that increase the starting rate of the annuity)
*Level
*Payable monthly in arrears
*Single life basis (no spouses/dependents benefit has been built in)
⏰
0:00 – Introduction
1:22 – What to watch out for?
2:11 – Tax?
2:38 – Annuity
5:47 – Annuity or Drawdown?
7:09 – Increasing Annuity
8:42 – Fixed Term Annuity
10:10 – Flexi Access Drawdown
12:15 – Bye!
Link to the Money Advice Service website for more general information about pensions and the options available to you: –
Video on how to check your State Pension Age and Forecast:
🗒 Please note:
The information provided is based on the current understanding of the relevant legislation and regulations and may be subject to alteration as a result of changes in legislation or practice. Also it may not reflect the options available under a specific product which may not be as wide as legislations and regulations allow.
All references to taxation are based on my understanding of current taxation law and practice and may be affected by future changes in legislation and the individual circumstances.
This channel is for information and education purposes only. Any information or guidance given does not act as financial advice. Please consult a financial adviser if you are unsure in anyway.
Keep in mind that the value of your investments can go down as well as up, so you could get back less than you invest.
⭐ My aim is to provide education and guidance to help individuals understand pensions, investments and protection.
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Retirement income options are a key part of financial planning for UK citizens. It is important to understand the different options available and how they can be used to create a secure retirement income.
One of the most popular retirement income options is a self-invested personal pension (SIPP). This is a type of pension plan that allows you to take control of your own retirement savings and investments. With a SIPP, you can choose from a wide range of investments, including stocks, bonds, and funds. You can also benefit from tax relief on contributions and tax-free growth on investments.
If you have a SIPP, you can take your pension in a number of different ways. The most common way is to take a lump sum, which is a single payment of your pension fund. This can be taken as either a one-off payment or as a series of payments over a period of time. Alternatively, you can use the money to purchase an annuity, which is a regular income for the rest of your life.
Another option is to take your pension as a drawdown. This is where you keep your pension fund invested and take regular payments from it. This allows you to benefit from the ongoing growth of your investments, while still receiving an income.
Finally, you can also take your pension as an income. This is where you receive regular payments from your pension fund, which can be used to cover your living expenses in retirement.
Whichever option you choose, it is important to understand the tax implications of taking your pension. You should also consider the impact of inflation on your retirement income, as well as the impact of any charges or fees.
It is also important to seek professional financial advice when deciding how to take your pension. This will help ensure that you make the most of your retirement savings and get the best deal for your retirement income.
Thanks Ed, this is all great info.
Can I ask – I have 5 pensions, 3 of which are frozen, 1 which I pay a laughably small payment into which I haven't increased since I started it, and a workplace pension scheme. One of these has a GAR, but ignoring that for now, when I come to retire how do I go about pooling these funds to buy an annuity (or any of the other drawdown style strategies you've outlined)? Would it just be a case of find an annuity supplier and giving them the fund details to make the purchase from? Thanks in advance!
Hi Ed
If you have.more than 1 personal pension can you take 25% tax free from both or is it combined across all your pensions?
Hello Edmund, having vinge- watched your interesting videos, I am thinking SIPP seems to make a lot of sense especially to save for retirement. If there are two directors in a company is it OK to do employer pension contributions to only one of the directors ( as the other director already has other pension contributions and therefore will go over the 40K allowance). Please could you clarify.
Interesting what has happened with annuities. Back in the day, you had to take one. I took mine from my private pension from age 60- I believed the actuaries had not advanced life expectancy sufficiently and that returns would fall in future. Sure enough, I checked at 65, and I would have got slightly less (despite having had 5 years payments already). Same thing at 70. One of my best gambles…
Inflation, especially in retirement, is very personal. As you know, mine is very low. I took my annuity level, since both my partner and I's state pension would be inflation linked, as would her teachers pension, and my contracted out pension. Total pensions rise way above inflation every year (esp. with triple lock).
Hi Edmund – so if I go for the 5 year fixed annuity in your example, I have £75k and take out £3,178 p.a. (= £15,890 over that period total), which means that I would have £59,110 left, however you are saying that I'd have £65,527 guaranteed at maturity – seems like a no brainier as I'm getting back £6,417 more than I received or am I missing something – why is this ??