Would you consider cashing in your pension for a lump sum?

image
Print Friendly

Retired workers could be given the right to sell their pensions under plans floated by the pensions minister.

From April, working people will be able to cash in their pension savings for a lump sum when they retire.

Lib Dem Steve Webb said he wanted to extend this to existing pensioners.

His plan would allow pensioners, if they wanted, to sell the annuities they had been required to buy under the old rules to the highest bidder.

This would allow them a lump sum to spend on what they liked, and could be used alongside other pensions they have accumulated, Mr Webb said.

He told BBC News his proposal would not be implemented by April when the changes affecting working people, announced in Chancellor George Osborne’s 2014 budget, come into force.

Mr Webb has previously said pensioners should be free to spend their pension savings on a Lamborghini if they wish.

Under the changes previously announced, people reaching retirement age will no longer have to buy a guaranteed annual income, in the form of an annuity.

Do you understand what the tax implications would be if you took a lump sum? Are you going to throw your cares to the wind and have some fun and let the future take care of itself?  Or do you feel responsible for your own future? 

What are your views?

Would you consider cashing in your pension for a lump sum?

1421 people have already voted, what's your opinion? Yes No

What are your views on this?

We'd love to hear your comments

Not a member?

Join the silversurfers community today! It's free, easy to do, and is packed full of features and amazing offers!

Join the community!
Click here if you have forgotten your password
djbowden59
6th Nov 2015
0
Thanks for voting!
If only i could, as i have little to survive on
scandiman
24th Jun 2015
0
Thanks for voting!
I am retired. I have a public sector pension, and took my small private one as 25% tax free, the rest taxable. Even though it will take me well below 40% tax thresh-hold, HMRC have taxed at that level. Contacting them is pointless, an electronic voice told me they will contact me in July. Why take 40% in the first place? They're a law unto themselves.
kabb
14th Mar 2015
1
Thanks for voting!
Check that your pension gives a tax free sum and since you get a better investment % wise from them rather then savings leave an amount in there for the following year.
banjo
6th Mar 2015
2
Thanks for voting!
my pension is only a very small amount so I will take it if & when the offer comes along.
Jonny
21st Feb 2015
3
Thanks for voting!
All very well, but do you trust any Government to provide you with an adequate state pension if, having taken cash from your pension pot, you have insfficient income?

I for one do not.
paisley pattern
18th Feb 2015
3
Thanks for voting!
Yes, definitely. I could do with some of the money now.
banjo
11th Feb 2015
3
Thanks for voting!
I only have a very small occupational pension so I would consider cashing my pension in.
Kinesco
11th Feb 2015
3
Thanks for voting!
For the past eight years I have managed my own SIPP and drawndown on a monthly basis what I have been allowed to do under HMRC rules .
Although I have drawn down substantial annual amounts I now have more in my account than I started with due to my careful equities trading.
If I had an annuity I would now be in a disasterous situation.
So having my cash now released to me from April 6th, I can now decide how much I need to drawdown without any interference from so called 'investment experts'.
As from April 6th I will only draw down sufficient sums that take me up to the 25% Tax bracket, but over the next five years I will take out all my money and stop the 1.25% annual management fee over the total value of my SIPP that I am currently charged.
The SIPP managers do absolutly nothing accept use my cash to make themseleves large amounts of interest whilst they offer me absolutely zero interest.
These, government approved, modern day Robin Hoods, need to be closed down and fast.
Kinesco
11th Feb 2015
3
Thanks for voting!
For those pensioners that need real returns, here is a way to achieve them. www.kinesco.com and the company is operated by pensioners for pensioners.
Munsterlander
7th Feb 2015
3
Thanks for voting!
I think we are very lucky now to have the choice. The old system has been a disaster for many and it is so unfair to the people who had to buy a low rate annuity.
I think we should all live a bit and splash the cash, but keep some back for that rainy day.
meggie83
6th Feb 2015
3
Thanks for voting!
I took out equity release on my house and invested the money to add to my pension.and carried out improvements to my house. It's worked for me.
davie4586
6th Feb 2015
3
Thanks for voting!
Worked hard and long all my life contracting on building sites and construction and wish to enjoy my retirement when I am reasonably healthy.
Archiebald
7th Feb 2015
4
Thanks for voting!
Agreed Davie and you need to enjoy today and now. I think a lot of our parents worked towards 65 to retire and then unfortunately many died young. One of my uncles did this it was such a shame. Saved all his life to retire and died at 65
Annabella
6th Feb 2015
3
Thanks for voting!
No I would want to cash pension for a lump, mainly you never know what is going to,happen long term
percival 41
6th Feb 2015
3
Thanks for voting!
no because we never know what happens long term
flickylou
18th Jan 2015
4
Thanks for voting!
So annoyed I had no choice 5 years ago and now have a pathetic annuity
issy1234
16th Jan 2015
2
Thanks for voting!
I WOULDN'T CASH IN MY PENSION AS WHO KNOWS WHAT WE WILL NEED AS WE AGE, IT WOULD BE GREAT TO GO AND BUY A NEW JAG CAR, BUT DREAMING WILL HAVE TO DO, IT WOULDNT BE PRACTICAL. SORRY FOR LARGE PRINT AND ERRORS IN MY WRITING AS STATED I HAVE A VISION PROBLEM
jaegergran
13th Jan 2015
6
Thanks for voting!
There was a programme on last night and I was quite surprised at how many were just going to blow their pensions on holidays etc. but then the amounts in many of their pension pots e.g. Some had only£30,0000 this would hardly make any difference to their income anyway, as a monthly pension, I think probably best to get electric, boilers, roof etc up to scratch or replaced so hopefully no big future money worries if you don't have much, or perhaps buy a flat and rent it our for an income if your pot is bigger.
One lady had a terminal illness and had just bought an annuity when it was announced, she would rather have left her money to her children and is now wondering what happens to the rest of her money we she goes, is it just lost.
Archiebald
13th Jan 2015
5
Thanks for voting!
I saw that programme as well with Michael Burke and thought it was very interesting. I cannot believe the schemes that people are peddling to us out there-Garages in the Middle East?...Trees in South America...where is the information from the government and the help and advice. Its not much better when looking at some of the pension providers site. The 62 page document that Michael Burke had from one was as he said just loaded with jargon and very difficult to understand. Surly it cannot be that hard to give us decent information?
Baxi
28th Jan 2015
3
Thanks for voting!
I agree Archiebald - sound advice and a bit of prudence will be important in all of this. Also tax advice - the big elephant in the room .... take the lump sum and get taxed AGAIN!!
lindaw
11th Jan 2015
6
Thanks for voting!
I did this - I've used the money to start x2 very interesting and hopefully lucrative new businesses. Time will tell if this was the right thing to do, but if all else fails I'll have 2 lovely narrow boats I can either live aboard or sell:)
dmbrewer
6th Feb 2015
3
Thanks for voting!
lindaw
7th Feb 2015
3
Thanks for voting!
Thank you, dmbrewer 🙂

If you're ever in Lancashire look for us on the Lancaster canal - we're pretty distinctive. See Facebook Graydees Dream. You'd be most welcome to come on board - the kettle is always on !
Baxi
28th Jan 2015
3
Thanks for voting!
What a brilliant thing to do Lindaw. Is that in the UK or overseas?
lindaw
28th Jan 2015
3
Thanks for voting!
In the UK, Baxi - on the lovely Lancaster canal. One boat is for my husband to operate.
He's also taken his 'draw down' and retrained as an RYA Inland Waterways Instructor. He'll be helping people get their Competent Crew, Helmsman and CEVNI qualifications so they can get the most out of their canal holidays, help protect the environment, get discounts from some hire companies on the network and hire boats on the continent.
The other boat is to be used as a skippered charter hotel boat for celebration cruises. So we'll be creating jobs in the area too.
To pull it all together, we're also in the process of setting up a charity to help young people access the training.
Our hope is to be able to commission a purpose-built wide beam boat that anyone ( mobility impaired; sight impaired etc) can crew and helm - we want people with disabilities to be able to take their family and friends on boating holidays, instead of them being taken by others.
Our other aim is to have the first disabled RYA Inland Waterways Instructor on our team. And a 'home-grown' one to boot.
We're having positive feedback from the RYA, Canal and Rivers Trust and Inland Waterways Association people we have spoken to. Other charities involved with young people and people with disabilities are being very helpful and encouraging. All this is very exciting and more than a little scary, but if can't think of anything I would prefer to do with my pension pot - regardless of the very real financial risks involved. We've sunk everything into the projects.
Now I need some other active, interested and young people-friendly 'mature' people to want to come and work with us - doesn't matter whether they're experienced boaters or not. We will give training as required. We need people with life experience to help train and mentor the youngsters in customer care as well as boating. Hopefully some of the youngsters will also turn out to be entrepreneurs and we hope to be able to get themselves launched in business. There are also waterways jobs in the UK and abroad, which holders of the qualifications can access.
Sorry to go on so long, Baxi, but I am passionate about this. If you would like to know more about the projects - or know someone who might be interested - please drop me a line : [email protected]. We also welcome visitors to Graydees Dream if you're ever in our area.
lindaw
28th Jan 2015
3
Thanks for voting!
Just thought - I ought to add that we had excellent advice from an IFA before we went down this route. He explained all the options open to us in no- nonsense and impartial terms. It helps that I had a 'final salary' pension and had bought AVCs over the years. We have a modest, but sufficient income from this. My husband has only a small pension, but together we are able to support our 2 sons who are still in education.
pengi
11th Jan 2015
4
Thanks for voting!
Is this an election ploy to win our vote
Archiebald
11th Jan 2015
4
Thanks for voting!
Probably if you think about it Mr Osbourne appears to be giving us pensioners the ability to cash in our pensions but when you do that after the first 25% its all taxed anyway
ronnieboy
11th Jan 2015
5
Thanks for voting!
this should be given serious consideration by all concerned, take advice from trusted recommended people,do your homework, do not rush into anything, one size will not fit all, take care, happy and healthy new year to all silversurfers.
Archiebald
11th Jan 2015
4
Thanks for voting!
Totally agree Ronnie..its worth reading up closely on these new rules as lump sums will still be taxed
Mike Brightman
10th Jan 2015
4
Thanks for voting!
How about the government bringing out a fail safe system where pensions can be topped up and awarded a guaranteed interest rate - not thrown out to the "free markets" where collapse and loss of all savings are not unknown! I know several people where this has happened in the past. And who do we trust? What sounds like a great idea to live for toady, recklessly, could turn out into a nightmare - I know what financial near disaster is like from the long distant past, thank God, and have helped people via Charity work who struggle to make ends meet by seeking grants, benefits not claimed etc - I'm a great one for having fun but don't let's go too wild - tempting though it is!!!! - Sorry to be a misery! (Michael Brightman author Mystery Factor ebook)
Wilf
10th Jan 2015
4
Thanks for voting!
Think you could be right Mike. I worry that people will blast away all their pensions. Also looking carefully at how it works it will be subject to tax and therefore the one off cash payment could be taxed at up to 45%...nice for HMRC...not so good for all of us!
Munsterlander
8th Jan 2015
5
Thanks for voting!
If it allows you to have a good time, when you still can get out, then go for it.
Peter
6th Jan 2015
6
Thanks for voting!
Anything that give us more flexibility and control over our pension options has to be a good thing.
shortyshah
6th Jan 2015
4
Thanks for voting!
I would like a percentage to keep me going whilst i am not working as this would allow me to do the things whilst i am still fit and able
.
janwa
5th Jan 2015
2
Thanks for voting!
I can see the workhouses coming back to this country. If you sell your annuity then run out of money they will make you sell your home and then put you in a home. No and No again
dougasteadman
5th Jan 2015
5
Thanks for voting!
I was allowed 25% of my pension (tax free ) and the rest as an annuity.
Depending on how sensible you are, taking the 100% of the pot up front (not sure about the tax implications) may be a bit risky. Xxx
Baxi
5th Jan 2015
6
Thanks for voting!
I think there are pros and cons. Some people will be sensible and make sure their money lasts and others will not ...
Gareth
5th Jan 2015
8
Thanks for voting!
Annuities are a rip off and I can only imagine this proposal will be as well......I have no trust in pension companies(look at there mega offices and charges)and even less In government ministers!!!!
Wilf
4th Jan 2015
3
Thanks for voting!
The only problem I see with all this is what happens when many people quickly spend their cash when taking this option. I have not read enough about it but I presume if a person was say 65 takes out an annuity in the form of cash...spends it in a couple of years...we are going to have a lot of poor pensioners and maybe the government will have to start bailing these folk out.
Archiebald
4th Jan 2015
4
Thanks for voting!
Yes I definitely would. I have always thought annuities were a nonsense. The average person didn't really understand them and I have kept an article from the Daily Mail of about 10 years ago which compared the amounts from different companies and the differences were substantial. Why should the government insist on annuities. I know they are changing it for new pensions but they should also change it for existing ones as Steve Webb has suggested. Its a good move and about time as well! get it sorted asap I say!

Community Terms & Conditions

Content standards

These content standards apply to any and all material which you contribute to our site (contributions), and to any interactive services associated with it.

You must comply with the spirit of the following standards as well as the letter. The standards apply to each part of any contribution as well as to its whole.

Contributions must:

be accurate (where they state facts); be genuinely held (where they state opinions); and comply with applicable law in the UK and in any country from which they are posted.

Contributions must not:

contain any material which is defamatory of any person; or contain any material which is obscene, offensive, hateful or inflammatory; or promote sexually explicit material; or promote violence; promote discrimination based on race, sex, religion, nationality, disability, sexual orientation or age; or infringe any copyright, database right or trade mark of any other person; or be likely to deceive any person; or be made in breach of any legal duty owed to a third party, such as a contractual duty or a duty of confidence; or promote any illegal activity; or be threatening, abuse or invade another’s privacy, or cause annoyance, inconvenience or needless anxiety; or be likely to harass, upset, embarrass, alarm or annoy any other person; or be used to impersonate any person, or to misrepresent your identity or affiliation with any person; or give the impression that they emanate from us, if this is not the case; or advocate, promote or assist any unlawful act such as (by way of example only) copyright infringement or computer misuse.

Nurturing a safe environment

Our Silversurfers community is designed to foster friendships, based on trust, honesty, integrity and loyalty and is underpinned by these values.

We don't tolerate swearing, and reserve the right to remove any posts which we feel may offend others... let's keep it friendly!

More Speakers Corner

Do you boil your Brussels? Cleaned brussel sprouts on a wooden cutting board with exterior leaves and a knife.
Brussels sprouts are a Christmas dinner must have but not to everyone likes them. You'll be...
Real or Artificial - What kind of Christmas tree will you have? Fresh cut Christmas trees
Each Christmas there is a ‘debate’ over real versus artificial Christmas trees. The...
Do you agree with Cryogenic Preservation? Excess smoky nitrogen gas discharge during filling of a liquid nitrogen dewar.
This week it was announced that a very brave 14 year old girl who had terminal cancer had won...
Should shops remain closed on Boxing Day? Boxing Day Sale cinnamon star on green wood concept.
A petition calling for a ban on shops opening on Boxing Day has attracted close to 194,000...
Will you be sending Christmas cards this year? Bracknell, England - October 28th, 2014: Vintage style Christmas cards. Modern cards originated from a printing in 1843 instigated by Sir Henry Cole, director of London's Victoria and Albert Museum.
The custom of sending Christmas cards was started in the UK in 1843 by Sir Henry Cole. He was a...
Do you still use cheques as payment? Signing a blank cheque with a fountain pen
** Note: Shallow depth of field
Cheques books have been used in the UK for over 350 years but they are now on the decline. In...
Are you surprised that Donald Trump won? Saint Louis, MO, USA - March 11, 2016: Donald Trump addresses supporters at the Peabody Opera House in Downtown Saint Louis
After months of campaigning, debating, mud slinging and scandals, the Americans have voted and...
Do you mind the gap? toblerone
The makers of Toblerone, Mondelez, have taken the decision to widen the gaps between the...
Should Nigel Farage be ennobled in the House of Lords? LONDON, UK - MAY 1, 2016: Nigel Farage seen arriving at the BBC to attend the Andrew Marr show
There are calls for Nigel Farage to be made a Lord and take his place as a peer in the upper...
Should the FA defy the poppy ban? poppy
England are due to host Scotland at a World Cup qualifying match at Wembley on November 11 ...
Who would you trust more to be the next US President? LONDON UK - MARCH 3RD 2016: Hillary Clinton and Donald Trump pin badges over the American flag symbolizing their battle to become the next President of the United States 3rd March 2016.
With the latest results today from ABC/Washington Post tracking poll, now showing Donald Trump...
Should the UK have a complete ban on selling Ivory products? ivoryburn2 900x600
Hugh Fearnley-Whittingstall, chef come wildlife campaigner, has been looking into the shocking...
Do you think Princess Beatrice and Eugenie should be given royal duties? London UK - June 17 2006: Princess Eugenie (left) and Princess Beatrice seating on the Royal Coach at Trooping the colour ceremony also known as the Queen's Birthday Parade
** Note: Slight blurriness, best at smaller sizes
It was revealed in the sunday papers that there is a nasty feud brewing between Prince Charles and...
Do you rake or vacuum? Yorkshire Dog on the autumn leaves blur
Autumn is in full swing, and the leaves are rapidly changing from luscious shades of green, to a...
Where do you think the extra runway should be built - Heathrow or Gatwick? Airplane touch down on runway during sunset
Since the 1970s various UK governments have been debating how to expand the UKs potential to...
Are the Government right to do a Pension U-turn? bigstock-Pensions-11274911
The government has done a huge U-turn on Pensions and scrapped the rights of 5 million pensioners...
Do city zoos still have a place in a modern society? gorilla in zoo
Last week’s incident at London Zoo, in which a male silverback gorilla escaped his enclosure...
Are hospital trusts cashing in on the sick? Ticket machine at the exit of a car park
Patients in England are being penalised with increasing parking charges with 30% of hospital...
Is BA trying to pull the wool over our eyes? BARCELONA SPAIN - DECEMBER 11: A British Airways Airbus A320 taking off on December 11 2014 in Barcelona. British Airways is the international airline of Great Britain with its headquarters in London.
Last week British Airways proudly announced that they will be partnering with Marks & Spencer...
Are we being ripped off? TERRY'S CHOCLATE ORANGE
It seems to happen every year now, that chocolate manufacturers start messing with our favourite...
If you were American would you vote for Donald Trump or Hillary Clinton? July 27, 2016: Illustration showing Republican Donald Trump versus Democrat Hillary Clinton face-off for American president with words Election 2016 on isolated white background done in stencil retro art style.
Last night was the first of three of the big TV debates between Hillary Clinton and Donald...
Will you still watch The Great British Bake Off without Mary Berry? Mary Berry
Earlier this month we asked our Silversurfers should the  Great British Bake Off should remain...
Do you prefer the new £5 note? chuchill-sterling-note
A new plastic £5 note that features Sir Winston Churchill and can survive a spin in the washing...
Should all cats wear a bell-collar? Closeup frontal view of calico cat with its recently caught wild bird.
According to statistics, there are 8.1 million cats in the UK that kill 275 million "prey items...
Had you planned to retire earlier than you are now able to? Worried senior woman, an elderly pensioner counting utility bills at her home, concept of financial security in old age
Changes in 1995 and 2011 to the state pension age mean women born on or after April 6, 1951 can...
Blue or Burgundy passports? biometric passport on a page of visas
It has just been announced by a Home Office Minister that the old blue passports for UK residents...
Should The Great British Bake Off remain with the BBC? WARNING: Embargoed for publication until: 28/07/2015 - Programme Name: The Great British Bake Off - TX: n/a - Episode: n/a (No. 1) - Picture Shows: +++Publication of this image is strictly embargoed until 00.01 hours Tuesday July 28th 2015+++ Paul Hollywood, Sue Perkins, Mel Giedroyc, Mary Berry, The Great British Bake Off contestants - (C) Love Productions - Photographer: Mark Bourdillon
First Top Gear, then The Voice and now Great British Bake Off. The BBC has lost the contract to...
Do you support the Junior Doctor's latest planned 5 day strike? Doctor. Close-up. Doctor hands crossed with stethoscope.
There is continuing unrest in hospitals as we hear today that Junior Doctors have more plans to...
Should an immediate ban on microbeads in toiletries be imposed? Illustration of lotion bottle with zoomed in particles of microbeads or lotion
Many cosmetics and toiletries such as shower gels and anti-ageing creams, scrubs and even...
Do you take HRT? Menopause - diagnosis written on a white piece of paper. Syringe and vaccine with drugs.
Following more than a decade of controversy, today we wake up to the news that hormone replacement...
Should the Government create more Grammar Schools? Portrait of three students: two girls and a boy in the middle of them. They're looking at camera and smiling. Blackboard behind them.
Theresa May and Justine Greening the new Education Secretary have said they would like to open...
Is Climate Change really happening? The Effect of Global Warming is shown on a landscape
The weather is an obsession with the British and no wonder with all the changes we get during our...
Should Punch and Judy be banned at public events? WEYMOUTH, DORSET, ENGLAND - AUGUST 31: Holiday makers sitting on the sands of Weymouth beach to watch a traditional Punch and Judy show on August 31 2012.  The old fashioned performance is attracting more tourists to the area.
Punch and Judy shows have been going for 350 years after one was first performed at Covent Garden...
Are the school holidays too long? the text school holidays made from modelling clay of different colors and some beach toys such as toy shovels and sand moulds, on a rustic wooden surface
O f course everyone needs a break: teachers, pupils, parents, all of us. And it’s lovely to...
Are you tempted to plan a digital detox? Trash Bin Button
Internet overload has led millions of people in the UK to take a "digital detox", according to...
Do you floss? Daily health care. Young man cleaning flossing his white teeth with dental floss
It seems like simple, sensible advice to improve our health : Eat five portions of fruit...
Who would make a better President - Donald or Hillary? Donald Trump and Hilary Clinton
D emocratic presidential candidate Hillary Clinton held a six-point lead over Republican rival...
Have you visited your GP in the last 5 years? Doctor. Close-up. Doctor hands crossed with stethoscope.
Patients could be struck off GP surgery lists after five years of no contact...