Buy my pension is a marketing term that is often used and is another way of saying; ‘pension release’ or ‘cash in pension’. If you want someone to “buy my pension”
or if you are thinking that one day the time might
come for you to sell your pension for cash then there
are a couple of things you need to think about. When
you ask someone to “buy my pension” you should note
that this is very different to taking out a lump sum. If
you want to release some cash, you can do this no problem
when you reach the age of 55. The main reason why you should
be wary about asking someone to “buy my pension” is because
you won’t have an income when the time comes for you to retire.
Even so, you can ask someone to “buy my pension” if you have
it in an occupational scheme or even in a personal scheme.
If you ask someone to “buy my pension” then this will certainly result in a reduced income when the time comes for you to retire. If you do sell your pension or if you want someone to buy my pension then there is a chance that you will want to do it for a cash sum. 25% of this is tax free but the rest of it will be taxed at the highest rate in terms of your income tax. For this reason, it is a good idea for you to sell your pension over time as this is the best way for you to avoid a hefty tax bill. So when you do see the term on posters, internet ads or other marketing material, and you see the words; ‘Buy my pension’ remember you could face a 55% tax bill…
The income you get after you have sold your pension will depend on the other options you have in place. For example, if you have a lot of investments then these can keep you going for quite some time. It is always a good idea for you to talk with your pension advisor so you can ask them to “buy my pension”. They will be able to talk you through the options that are available and they can also talk with you to see what options are available.
Of course, they can also make sure that you are more than comfortable with the options you have available as well so this is another benefit you get when you get in touch with them. If you don’t know if the investments you have now are enough to keep you going then you can ask them about this as well and this is a great way for you to decide whether or not you can keep going on the money that you have after you sell your pension
Of course, they would always be happy to advise you to see if you can sell part of your pension or if you can somehow take some of your money out before you make the sale and this is a great way for you to make some money as well as making sure that you don’t end up paying more tax than you need on your finances and everything else that is involved with the transaction.
if you are looking for more information about your pension or want to understand your options then contact our team for more information.