When you come to retire, you have a range of options available to you for how you can take your benefits.
Option 1 – Receive a retirement income for life, with or without a cash lump sum
If you choose to take a cash lump sum, this will reduce your retirement income for life.
If you choose this option, you have other benefits available to you including:
If you choose this option, your pension is payable for your lifetime by monthly instalments in advance. It is paid directly into your bank or building society account.
Option 2 – Transfer your benefits to another pension arrangement
You also have the option of transferring your pension benefits, to provide you with more flexibility. If you decide to transfer, you’ll need to consider carefully whether this is the right option for your circumstances.
In order to transfer your benefits, you’ll need to request the transfer value, otherwise known as a Cash Equivalent Transfer Value (CETV). The CETV is calculated as the amount which needs to be invested in order to provide your future pension. It takes account of the number of years before retirement and financial conditions at the date of payment of the CETV.
You have the right, each year, to ask for your CETV free of charge. Additional requests for a CETV quotation within the same 12-month period will be chargeable.
If your CETV is £30,000 or more, you are legally required to seek financial advice. If the CETV is less than £30,000 we still strongly recommend that you seek appropriate advice