SIPP & Private Pension Advice

In the UK, there are three main types of pensions: State Pensions, Workplace Pensions, and Personal Pensions. The State Pension is a regular payment from the government that you can claim when you reach State Pension age, provided you’ve paid enough National Insurance contributions. Workplace pensions are usually arranged by employers, while personal pensions are set up by individuals. Each type of pension comes with its own rules, benefits, and tax implications.

The age you can start claiming your pension varies depending on the type of pension you have. The State Pension age is currently 66, but this is rising to 67 by 2028. Workplace and Private Pensions often allow you to start accessing your pension savings from the age of 55 (rising to 57 by 2028), though you may decide to defer taking your pension to receive larger payments later.

Defined Benefit (DB), often referred to as ‘Final Salary’ or ‘career average’ pensions, provide a guaranteed income in retirement based on your salary and the number of years you’ve worked for your employer. Although you still need to make personal contributions to a DB pension, the annual pension income you receive is not based on how much you have paid in. As they are guaranteed for as long as you live, DB pension schemes can provide more security. However, few employers still offer them to new employees.

Need advice on your current Defined Benefit Plan or looking to set one up? Get in touch today.

Your pension can usually be passed on to your beneficiaries. Defined Contribution Pensions can be left as a lump sum or income, often free of tax if you die before 75

Pension Consolidation is when you combine multiple pensions into one plan. It can make managing your retirement savings simpler and potentially reduce your fees, but it’s not without its risks. We always recommend that you speak with a qualified professional before making any major changes with your pensions. Take a look here to find out about our Pension Consolidation Services.