Take a flexible retirement

Take a flexible retirement

If you transfer your Plan benefits to a defined contribution arrangement, you’ll usually be able take smaller lump sums, as and when you need them. A maximum 25% of each one would be tax-free, with the
remainder taxed as income.

Alternatively, you could take a one-off tax-free lump sum and then invest the rest of your defined contribution account in an ‘income drawdown’ policy.

If you choose income drawdown, you’ll need to decide how to invest the balance of your drawdown account (once you’ve taken a lump sum). With income drawdown, it’s important you’re aware there is a risk you could run out of money before you die. However, you are not tied to drawdown; In the future (and in most cases), you will have the option to buy a pension for life (an ‘annuity’) with the remainder of your drawdown account.