Pension release

So-called “pension release”, “pension liberation” or “pension unlocking” scams claim to be able to unlock your pension before you reach 55.

In the UK you can legally access your pension pot from the age of 55, except in some cases if you have a very serious illness. If you access your pot before this, through what a scammer might call a “loophole”, you will be subject to very heavy tax charges that could see you lose most of your money.

Scammers might contact you by email or telephone, and will often try to charge commission fees for bogus pension transfers.

Two golden rules about pension release schemes

  1. Never give your financial information to a cold caller.
  2. If it sounds too good to be true – it probably is!

Your options when you reach 55

Once you reach the age of 55 you can usually start to withdraw from your pension pot as long as your pension provider allows. Under new rules you have many more option for how you take an income from your pension pot, including income drawdown or taking an annuity. For more information read our guide to retirement income options.

You don’t have to retire completely to start withdrawing from your pension, and many people continue to work even after they start to take an income. However, the earlier you start to take money out the more likely it is that your pension pot will run out early, so planning ahead is key.

If in doubt, seek advice

A financial adviser can provide advice on your options for taking an income from your pension pot.

Last updated: 04 June 2015