hello my name's faith and today we're
talking about early pension release
early pension release means withdrawing
money from your pension before the
minimum age of 55 rising to 57 from
2028.
it's also sometimes called pension
liberation pension unlocking or a
pension loan
unless you have exceptional
circumstances such as ill health you'll
be charged a substantial amount of tax
on any withdrawal and you could risk
losing all your savings to scammers
when you reach retirement age you can
use your pension to take a 25 tax-free
lump sum
you can then use the remainder to buy an
annuity which provides a guaranteed
income for the rest of your life or for
a fixed number of years
alternatively you can simply draw down
your money as you wish subject to income
tax
before retirement age you'll have to
meet certain conditions if you want to
access your pension
for example
if you're in ill health or have a
serious medical condition you may be
able to access your pension early
if you're younger than 55 and have been
given less than a year to live you may
be entitled to take your whole pension
pot as a tax-free lump sum
it may be possible to access your
retirement savings early if you have a
protected retirement date specified in
your pensions policy paperwork outlining
the age at which you can begin accessing
your savings early
this must have been granted before 6th
of april 2006 to be valid and is only
applicable
to certain professions where early
retirement is typical such as
professional sports
if none of these circumstances apply
hmrc could view an early pension release
as an unauthorized withdrawal and you'll
be charged up to 55
on the amount you take out
because of this high tax it's very
unlikely a reputable pension provider
will help you to release a pension early
which means you'll need a third party to
help you
they could charge you up to 30 to do so
which means you could be left with just
15
of your overall pension
usually the firms that arrange early
pension release before retirement age
are not authorized by the financial
conduct authority which means you'll
have no protection if anything goes
wrong
unauthorized early pension release also
puts you at risk of running out of money
before retirement
meaning you'll have to work much longer
than planned in order to fund your later
years
there are numerous pension scams that
claim they can help you to access your
pension before retirement age by
exploiting loopholes in the system
unless you meet some of the criteria
i've mentioned or have been explicitly
told by your pension provider that you
qualify for early pension release you
shouldn't trust a third party to act on
your behalf
pensionbee does not allow unauthorized
payments before retirement age under any
circumstances
if you're thinking about early pension
release here are a few things to
remember
consider your options carefully
before you make any decisions about
early pension release it's important to
calculate how much money you have and
how long it will need to last you
pensionbee's pension calculator can help
you figure out how much you can
realistically afford to withdraw
if you have a defined contribution
pension under aged 50 or over you can
book a free pension wise appointment to
learn about your options and how to
prepare for retirement
if you think you're eligible for early
pension release due to ill health or a
protected retirement date
contact your pension provider for more
information
if you think you can access your pension
early for another reason check the
details of your policy and still speak
to your pension provider in the first
instance
don't share any details about your
pension
be wary if someone approaches you out of
the blue offering a free pension review
or who claims they can help you release
your pension before retirement age
you could receive a phone call text
message letter email or be approached in
person so it's important to be vigilant
with anyone who inquires about your
pension
don't keep anything suspicious to
yourself
if you or someone you know has been
approached about early pension release
and you think it could be a pension scam
you should report it straight away
call the financial conduct authorities
helpline or visit the fca website
finally if you're worried about money
and want support or further information
about managing your finances contact
citizens advice
remember pensions are an investment like
all investments the value of your pot
can go down as well as up over time so
your capital is at risk
for more information about early pension
release visit pensionbee's pensions
explained centre
you