Leaving your money where it is

What will happen if I leave my money in my pension?

From the minimum retirement age, currently 55, you can choose to take money out of your pension, or leave it where it is.

If you leave it where it is, your money could potentially grow further – though your money could also go down in value. Remember, you don’t have to decide straight away. You can take as much time as you like to decide what to do with your money. Even if you’re fast approaching your retirement date, you still don’t have to take any money from your pension when the time arrives.

You might not want to retire as soon as you reach State Pension age, or at the age you’d originally planned to stop working at. If this is the case, you can simply leave your pension where it is until you’re ready. Remember, you’ll need to let your pension provider know if you do intend to delay your retirement.

If you’re not ready to take money yet

There are some important points to consider:

  • Whilst it's still invested in your pension, your money can go down in value as well as up. You might get back less than has been invested.
  • If you eventually decide to buy a retirement income for life, there’s no guarantee you’ll get more or even the same amount as you would if you were to buy one now.
  • While your pension money remains invested, your pension provider may continue to take account charges and fund charges.
  • Delaying your retirement may affect any state benefits you’re eligible for.
  • If you have life insurance under your plan, this policy will come to an end at your original retirement date.
  • If you’re about to retire or reduce your working hours, you may not be able to carry on making payments into your pension at the same rate.

Remember, if you decide that now isn't the right time for you to take money from your pension, you can still choose to change where your money’s invested.

Check out the terms of your pension

You need to check the terms and conditions that apply to your pension before you make a decision on delaying your retirement – especially if you’re considering a lengthy delay. In the case of some older pension policies, you may be contracted to use your money to buy an annuity when you reach 75, or you may lose valuable guarantees if you don’t take benefits at the age you originally planned.

Pension Wise has been set up by the government and offers free and impartial guidance for people retiring with defined contribution pensions. It will help you understand what your choices are and how they work.

You'll be able to get help on the Pension Wise website, over the phone or face to face.

If you are approaching retirement we recommend you get guidance or advice to help you understand your options.

Need some help?

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There’s a lot to think about when planning your retirement. Take a look at our

Frequently Asked Questions.

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