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Experienced Independent Financial Advisers

Moving closer to retirement

22 Jun 2020

Delay taking your pension if you can

For those people moving closer to retirement who may have been impacted by the recent market volatility, an option to consider is deferring your private pension.

If you’re in a defined contribution scheme, delaying when you claim means that you leave your pension pot invested for longer, so you could secure a bigger pension pot when you do eventually come to retire.
Deferring also means that you can continue to save as much as £40,000 in the current tax year into a pension and earn tax relief under current rules. There is also the opportunity to defer your State Pension for extra income.

Choosing to defer your State Pension means that once you do start claiming it, you’ll receive more than you otherwise would have. It can also help you manage your tax liability if you don’t want to be pushed into a higher income bracket.

The most important thing to do in the face of what is an unexpected and uncertain period for investors is not panic. We have seen extremely volatile stock markets recently, and it is impossible to say when markets will recover.

5 reasons to delay taking your pension
Your pension has longer to grow
You can maximise your investment potential before moving to safer assets
Your employer will keep topping up your pension
You’ll continue to receive tax relief on pension contributions until age 75
Delaying your State Pension can boost your payments

Footnote: Our belief is that all finacial advice should be tailored to your particular needs and situation. The content of the articles featured in here are for your general information and use only; they are not intended to address your particular requirements or constitute a full and authoritative statement of the law. They should not be relied upon in their entirety and shall not be deemed to be, or constitute advice. Although endeavours have been made to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No individual or company should act upon such information without receiving appropriate professional advice after a thorough examination of their particular situation. Please get in touch to meet with us for a full consultation.

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