TheMoneyBroker's Guide: Cash in on pension with pension release

Reaching the third age, although at times emotionally sensitive, is also a time of harvest. Literally. Any UK resident with a pension plan, whether current or deferred, or yet frozen, is entitled by local legislation to a pension release. In a nutshell, this is cash or income you can receive before you reach retirement age. By law, pension release applies to individuals between 55 and 64 years of age yet some providers can work with you even if you are aged below 55, provided you meet certain requirements. One important prerequisite is that the market transfer value of your pension plan has to be £25,000.

The pros

Pension release is a viable financing opportunity if for whatever reason you are in need of funds. Pension release advisers can arrange that up to 25% of your pension be transferred to your account, all that tax free (however, be warned that any extra increments will be levied a tax). There are particular circumstances which can qualify for a total pension cash-in.

Yet another upside is that you can "unlock" your pension and then withdraw amounts in parts, one now and the rest at a later point. You can also agree on taking the entire sum at a time or yet allocate it over time, in the form of annuity. In the latter instance, you will already be tasting the regularity of steady monthly income that retired persons enjoy.

The cons

However nice the prospect of getting fresh money, say, 10 years early, you have to know the consequential effects it brings. For one, your pension plan will be downsized by the amount you have taken and your monthly income upon retirement will reflect that. What is more, all the profit you reap from your pension provider's successful investment policy will be commensurately reduced.

If you tend to regard pension release as cash for clearing your debt, prepare to wait. Generally, the pension unlocking procedure takes between 6 and 8 weeks.

You can't take out your pension before 55 years of age. There are many websites online that claim to give you this option but don't go for it. This option is illegal and if you go for it, you may pursued by the government and asked to give the money back. 


To get the best out of your situation, it might be useful to consult pension release consultants. An online form at Cash My Pension Experts will return a list with all the options relevant to your case. Unlike most pension advisers, they work with you with no strings attached. You do not have to pay a setup cost, nor will be bound to pay them monthly fees. You will neither be subject to medical or credit checks, nor will be asked about your age.

At Avril Pension Services, you also enjoy the same set of benefits and one more: you can release your pension and then borrow tax-free up to 25% from your pension savings.

With Grove Pension Release, you can find the most lucrative option with the Most Innovative Pensions Consultant nominee for 2020. If you wish to make sure that pension release is for you, you should refer to their rich pension release library placed in their information and blog sections.

You may want to read about: Cash in Your Pension

The information on this page is designed to help you understand more and make more informed choices. We do not receive any commissions, instead we are funded from companies that we advertise on our website.