April 2015 marked the beginning of one of the biggest changes to our pension system in generations.
We have just moved into an era where many people will make their own choices about what they do with their pensions. Without doubt this is a revolution, and as with any revolution it’s hard to say what will be the outcome.
The changes stem back to a government decision in 2014 when it was decided that people needed to be trusted more with decisions about their own savings.
So what can people actually do?
From April 2015 individuals currently over the age of 55 years will be able to access their accumulated pension pot. It will not matter what type of pension they have, be it a personal pension, a defined contribution pension, or a money purchase arrangement.
The pension access will be, in part, tax free and the remainder subject to the individuals’ marginal rate of income tax.
Individuals will have far more choice than ever before when it comes to their accumulated funds:
What are the choices?
- purchase the security of an annuity if you wish
- withdraw everything from your pension pot
- keep your pension invested and drawn amounts over time
Can people get free guidance to help them make their pension decisions?
People will be entitled to receive free, impartial guidance in order to explain the new choices they have. This guidance will help them make informed and confident decisions about how they use their defined contribution pensions.
Are you aware of this change and even more importantly are you ready?
At David Allen Financial Services we are fully committed to helping our clients through these changing circumstances. We will make sure you have the best pension for your circumstances and will guide you through the whole process.
Contact one of our Independent Financial Advisers on 01228 711881 to discuss your own individual pension circumstances.
Posted: August 17th, 2015