Is it better to take a pension or a lump sum?

Is it better to take a pension or a lump sum?

Lump-sum payments give you more control over your money, allowing you the flexibility of spending it or investing it when and how you see fit. It is not uncommon for people who take a lump sum to outlive the payment, while pension payments continue until death.

Do husband and wife get separate pensions?

Unfortunately that’s pensions for you! But the goods news is that despite being married you will be treated as individuals and each receive a Basic State Pension based on your own National Insurance records (NI). As you both have full records you should each receive the full Basic State Pension.

What happens to my pension when I retire?

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When you finish working, you need to turn your pension savings into an income for your retirement. Currently, you can usually take up to one quarter of your money as tax free cash and use the remainder to secure an income for the rest of your life, most often as an annuity or income drawdown.

When you die what happens to your pension?

The scheme will normally pay out the value of your pension pot at your date of death. This amount can be paid as a tax-free cash lump sum provided you are under age 75 when you die. The value of the pension pot may instead be used to buy an income which is payable tax free if you are under age 75 when you die.