MJR Financial Services, 33 Mercer Row, Louth, Lincolnshire, LN11 9JG
Telephone. 01507 604550 -- Email. info@mjrfinancialservices.co.uk
 
 



Retirement Planning

Since 6 April 2015 you have had complete freedom to use your pension savings as you wish from age 55.

There is new flexibility for annuities should you require an ‘insured’ solution. Income will be able to go down as well as up if you choose an investment linked version, and guarantees won’t be limited to a maximum of 10 years.

A lot has been made of the new rules and how they relate to Final Salary pension schemes. These rules are complicated and a short summary would not do justice to the intricacies associated with such schemes. Should you be a member, current or deferred, of a Final Salary scheme, we can put you in touch with a firm of specialists in this area.

For those with Defined Contribution (also known as money purchase) pension schemes, such as SIPPs or Personal Pensions, looking for greater flexibility, you now have five options:

1. Full flexi-access drawdown:
Take all tax-free cash and designate the remaining funds as a drawdown ‘income’ pot for flexible, unlimited access (albeit taxable).

2. Phased flexi-access drawdown:
Take some tax-free cash; designate the attaching ‘income’ pot for flexible unlimited access (taxable) and leave the remaining, untouched funds as a ‘savings’ pot.

3. Full withdrawal - no drawdown:
Withdraw the entire pot in one go as a capital lump sum – with 25% tax-free and the remainder subject to Income Tax at your marginal rate

4. Phased withdrawal - no drawdown:
Allows the pension provider to pay the policyholder a one-off lump sum without the need to officially convert to a drawdown plan – 25% of this payment will be tax free and the balance taxed at the marginal rate. This is called uncrystallised funds pension lump sum or UFPLS for short!

5. You can still use your pension pot to buy a traditional annuity that gives you a guaranteed income for the rest of your life. You can take 25% of your pot as tax-free cash and buy an annuity with the other 75%. You will have to pay tax on your annuity income.

It is important to note that those in a Capped Drawdown arrangement prior to 6 April 2015, will still be reviewed every three years if you're under age 75, and yearly after this, using the Income limits based on Government Actuary Department (GAD) rates, unless you opt to use one of the other methods of taking pension benefits.


Pensions

We can help you understand the different types of pensions available, such as workplace pensions, personal pensions, self-invested personal pensions (SIPPs), and stakeholder pensions, and which one is most suitable for your situation. But the basic principle is the same – you save money for your retirement, which is then invested to grow over time.

It's important to start planning for your retirement as early as possible and to regularly review and adjust your pension plan as your circumstances change, such as changes in your employment status, income level, and financial goals.

One of the key benefits of pensions is the tax relief you receive on your contributions. When you pay money into a pension, the government adds tax relief, based on your income tax rate, to boost your savings. This can make a significant difference to the amount you have saved by the time you retire.

When you reach retirement age, we will help you understand your options for accessing your pension savings. This could include taking a tax-free lump sum, purchasing an annuity, or setting up a drawdown arrangement.

Our goal is to help you make informed decisions about your pension savings so that you can enjoy a comfortable retirement. Contact us today to learn more about how we can help you with your pension planning.



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The advice and/or guidance contained within this site is subject to the UK regulatory regime and is therefore targeted at consumers based in the UK. Where you have a complaint or dispute with us and we are unable to resolve this to your satisfaction then we are obliged to offer you the Financial Ombudsman Service to help resolve this.

Please see the following link for further details: https://financial-ombudsman.org.uk 

For the Money & Pension Service's consumer website "Money Helper" please go to http://www.moneyhelper.org.uk

MJR Financial Services is a trading style of Michael Rice which is authorised and regulated by the Financial Conduct Authority.
We are entered on the Financial Services Register No. 711711 https://www.fca.org.uk/firms/financial-services-register

Telephone 01507 604550 | Email info@mjrfinancialservices.co.uk | Principal: Michael J Rice