Spreading your tax-free cash across all withdrawals with The People’s Pension

With The People’s Pension, you have an Online Account where you can check the balance of your pension pot.

And if you want to take a lump sum from your pot, you can do that through your Online Account too. You’ll just need to fill out an online form each time you want to request a lump sum.

Or you can give us a ring – you don’t have to do it online if you don’t want to.

You can take 1 lump sum a tax month. For example, from 6 May to 5 June. We don’t charge you for taking lump sums. More about taking your tax-free cash up front

You must take a minimum of £2,000 each time you take a lump sum from your pot with The People’s Pension. If you get to a point where you’re left with less than £2,000 in your pension pot, you can request a final withdrawal of what’s left. It’ll be taxed just like your other lump sum withdrawals. After this final withdrawal, your pot with The People’s Pension will be closed. If you and/or your employer carry on paying into your account with The People’s Pension after that, your money will go into a new pot. So you’d need to build up more than £10,000 in the new pot before you’d have the option to take it a bit at a time again.

If you’re still going to be working after you start taking money from your pension pot, you might want to continue saving into a pension to make the most of your employer’s contributions. Or even if you’re not going to be working, you might want to continue making your own contributions. After you start taking lump sums, the rest of your money remains in your pension pot with us and your account can still receive contributions, the only difference is, once you start taking lump sums you’ll have a reduced limit of how much you can save into a pension and receive tax relief on. More about continuing to save.

You can nominate someone (or more than one person, or an organisation) to receive the money in your pension pot if you die – called your ‘beneficiary’. If you’ve already nominated a beneficiary for your pension pot with The People’s Pension, your beneficiary will stay the same after you start taking lump sums from it. With The People’s Pension, any money we pass on to your beneficiary would be paid to them as a single lump sum – we can’t pay it to them as an income, or carry on investing it on their behalf. More about what happens to your pension savings when you die

Once you’ve taken a lump sum from your pot, you can leave the rest of it invested or continue to withdraw further lump sums. Or, you could choose to take a different retirement option with the rest or your pot or transfer it to another provider. More about mixing your options

Different providers offer different versions of this option, so you might want to shop around to find the best deal for you. There’s a lot of jargon in the pensions industry, and we understand that this can make it difficult to compare your options across different providers – because unfortunately not everyone uses the same terminology. To make it easier for you to compare, here’s a few different ways this option is often described:

• Taking your tax-free cash gradually over a number of lump sums
• Taking lump sums directly from your pension pot
• Taking a number of flexible lump sums
• Taking uncrystallised funds pension lump sums or UFPLS

• There’s a risk you won’t have enough money to live off in your retirement – or that your money could run out too soon if you take too much too quickly. So you need to plan carefully and work out how much you’ll need.
• There’s a risk you could pay more tax than you planned for. So make sure you understand the tax consequences and consider your personal tax circumstances.
• From the first lump sum you take, you’ll have a reduced money purchase annual allowance. Find out more about this if you plan on continuing to save.
• If you get any means-tested benefits, taking your pension savings could affect your entitlement to these. Find out more about this on the government’s website.
• If you have any unsecured debts or creditors, the money you take from your pension savings may be available to your creditors to satisfy any debts you have.
• There’s a chance there’s a better deal out there for you. So you should shop around and understand all your options. But make sure you avoid pension scams too.
• With The People’s Pension, there is an annual management charge made up of 3 elements – an annual charge, an ongoing management charge of 0.5% (50p for every £100 saved) and a rebate on the management charge. The rebate level depends on how much is in your pension pot. When you take money out, we’ll work out future rebates on the value of your remaining savings. The annual charge is not deducted from flexi-access drawdown accounts. Read more about our member annual management charge. To find out exactly how much you’re charged, please log into your Online Account and go to ‘Manage my pension’, followed by ‘Charges’.

Before you take your pension pot a bit at a time with The People’s Pension, we recommend you read:

• our booklet – Your options at retirement
• the Money Advice Service’s booklet – Your pension: it’s time to choose
• and The Pensions Regulator’s booklet on avoiding pension scams.

We also recommend you get in touch with the government’s Pension Wise service for free and impartial guidance on your options. Plus, you might want to consider getting some advice from a financial adviser. More about your guidance and advice options

If you’re ready to take your pension pot a bit at a time (and as long as you’re 55 or over) – the quickest way to request this is through your Online Account.

Find out how to take your pension money