Pension drawdown

• You can usually take up to 25% of your pension pot as a tax-free lump sum
• You have the option of taking this cash from your pension at any point from age 55 (57 from 2028)
• The rest of your money stays in your pension for you to manage
• Flexibility of taking money when you need it and making further contributions if you wish
• If you manage your money carefully and regularly review how any income is reducing your pension pot, you can help to ensure that your money lasts as long as possible
• You can choose where to invest your pension to meet your needs
• Your pension can be passed onto your beneficiaries when you die
• Your pension often sits outside your estate and doesn't normally count towards your estate's value (although this is due to change from 6 April 2027). This means your pension won't usually count towards your inheritance tax allowance and can be a great way to leave something to loved ones. It's important to have your beneficiary and expression of wish forms up to date. If your death occurs after your 75th birthday, the benefits paid will be subject to your beneficiaries income tax rate.

• Once you've taken the 25% tax-free lump sum that you're usually allowed to withdraw, all income is taxed the same as any earnings you have. You should ensure you understand what tax rates might apply to you
• You could run out of money if you take too much income from your pension pot
• Your pension pot could go down dramatically if you don’t regularly monitor how your funds are performing
• You need to decide which funds your pension pot is invested in as the performance of any funds will affect how long any income will last

• Bringing your pensions together can make it much easier to plan for your retirement – and help you look after your money in the years ahead.
• It could open more investment options or more types of retirement income, if your current provider has limited options available.
• It could also save you money as costs can vary significantly between providers. And, over a long retirement, small changes in price can lead to a big difference in how much you have.

Important Information: It’s important to understand that pension transfers are a complex area and may not be suitable for everyone. Before going ahead with a pension transfer, we strongly recommend that you undertake a full comparison of the benefits, charges and features offered. To find out what else you should consider before transferring, please read our SIPP transfer factsheet. If you are in any doubt whether or not a pension transfer is suitable for your circumstances, we strongly suggest that you seek advice from one of Fidelity's advisers or an authorised financial adviser of your choice.

• The annual allowance is the limit on how much you can save into your pensions each tax-year while still benefiting from tax relief on your contributions.
• Once you begin taking taxable money from your pension, generally you'll be subject to a reduced annual allowance that limits the tax relief that you can receive on future contributions.
• If the value of your pensions is close to £1,073,100, or likely to reach this by the time you retire, then you need to know about the Lump Sum Allowance as well as the Lump Sum and Death Benefit Allowance

Drawdown allows you to leave your money in your pension pot and take regular income or lump sums from it as and when you want. It's often referred to as income drawdown. Any money left in your pension pot remains invested, which may give your pension pot a chance to grow, but it could go down in value too.

It can depend on your pension provider, but if you choose to apply with us, we'll use the Fidelity SIPP as your pension account. You won't normally be able to start drawdown until you are 55 (57 from 2028). When you're close to reaching your selected retirement age, we'll send you a pack which will provide you with lots of useful information about your available options - which includes accessing our online drawdown service and talking to a retirement specialist.

If you have any questions about retirement planning in general, the income options or want to apply for drawdown, you can find out more here or call our retirement team on 0800 41 41 61.

You can usually access money from your personal pensions - including those set up by your employer - when you reach 55 (57 from 2028).

You’ll need enough money to live off throughout the whole of your retirement. Your retirement could last for 30 years on more (depending on when you retire and how long you live). Therefore, you’ll need to carefully plan how and when you access your money, and how much you take.

How long your pension income will last will depend on how much you've saved over the course of your life, how much you withdraw each time you take income, how your investments perform over time and how long you need the money.

You can find out more about how long you may need your pension to last on ons.gov.uk or you can explore our retirement calculators to see how much you may need.

Depending on the type of pension you have and your current circumstances, you can flexibly take whatever level of income you want – and change it when you need to. Each of the main options usually allow you to take up to 25% of your pot tax-free.

Our pension drawdown calculator can help you understand how much income you could take and how long your pension might last if you opt for a flexible retirement income (drawdown).

Yes. When deciding how you want any money you're moving into drawdown to be invested you have the option of choosing one of our Investment Pathways. These are investments designed around four clear targets for retirement income, ranging from ‘I have no plans to touch my money in the next five years’ to ‘I plan to take out all my money within the next five years’. You can find out more about the Fidelity Investment Pathways here.

Yes, you can still make pension contributions and you can still receive tax relief on these contributions. However, once you begin withdrawing taxable money from your pension you may be subject to the money purchase annual allowance (MPAA). The MPAA reduces the amount that can be contributed to your money purchase pensions in any one tax-year while still benefiting from tax relief to £10,000 (compared to the standard annual allowance of £60,000).