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Message: <blockquote data-quote="Naijafans" data-source="post: 4832" data-attributes="member: 1"><h2>When can I withdraw my pension?</h2>If you have a defined contribution pension and are 55 or over, you should be able to start making pension withdrawals. If you still have a way to go until retirement, it’s important to note that this age is set to rise to 57 in 2028. In certain circumstances, you may be able to access your pension savings before you are 55. These might include if you are in ill health or have a protected retirement age.Although you can access your money from age 55, that doesn’t necessarily mean you should. Unless you have an urgent need for the money, it is usually best to leave it until you’ve retired. Leaving your pension invested will allow it to carry on growing and also reduce the number of years you’ll need it to fund you in retirement.If you have a defined benefit pension, also known as a final salary pension, it’s possible you could have a retirement age of 65. This is usually when your pension starts being paid. You may be able to take a reduced income from the age of 55, but this will depend on the rules for your pension. Check with your scheme to find out the retirement age and early access rules for your pension.<h2>Can I withdraw my pension before 55?</h2>There is no law to stop you withdrawing money from a pension before you turn 55, but unless you meet certain criteria, the tax and fees you’re likely to pay mean it might not be the sensible thing to do.You may be allowed to access your pension early and avoid onerous tax and charges if:<ul> <li data-xf-list-type="ul">You are in poor health or have a serious medical condition, which means you can’t work.</li> <li data-xf-list-type="ul">You have been given less than a year to live — (in this instance you could be able to take your entire pension as a tax-free lump sum).</li> <li data-xf-list-type="ul">Your pension has a lower than usual protected retirement age, perhaps if you’re an elite sportsperson.</li> </ul>If you don’t meet the above criteria and you withdraw money from your pension, HMRC could charge you up to 55% tax on the amount you withdraw. Because of the hefty tax charge on early pension withdrawals, and the fees you’re likely to be charged by your pension provider, most reputable pension companies will strongly discourage you from accessing a pension early.If you’re unexpectedly offered the chance to access your pension early, there is a good chance this will be a <a href="https://www.nerdwallet.com/uk/personal-finance/pension-scams/" target="_blank">pension scam</a>.<h2>How much can I withdraw from my pension?</h2>If you have a defined contribution pension, when you turn 55 you can take as much as you like from your pension. You can cash the whole lot in, or take regular income or ad hoc lump sums.The first 25% of your pension can be taken tax-free. This is often taken as a one-off lump sum, but can also be applied to smaller withdrawals. The remaining 75% will be subject to income tax.Depending on the size of your withdrawal this could add up to a sizeable tax bill, particularly if it pushes you into a higher income tax bracket.If you are cashing in a whole pension, you should think carefully about how you will use that money to fund your retirement, particularly if it’s your only pension.Although you may like the idea of getting your hands on your money, it may make more sense to leave your pension invested, rather than withdrawing it to sit in a current or savings account.</blockquote>

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