Can I start the pension release process before I turn 55?

For most people, the earliest they can take money from their pension is 55 years old. However, you can begin the process before 55 to speed up the pension release process.

The quick and easy guide to pension release

If you are thinking about taking money early from your pension, then this guide is for you. It contains some of the key facts and information you need to consider and ends with answers to some of the most common questions we are asked.

The headline facts at a glance

You need to be aged 55 or over and have the right kind of pension before you can take money from it. However, you can begin the process a little earlier, generally within 6 months of your 55th birthday. This ensures that all the work has been carried out, so that you can receive your money once eligible.
In very rare circumstances, such as extremely poor health, you may be able to take money from your pension before you are 55. 
The amount you withdraw is completely up to you and the first 25% is tax free*. As you might have guessed, the rest is taxed as income. You may already have some questions, to which you will hopefully find the answers at the end of this page. The first things to consider, though, are the big three topics: would I? Should I? And how?

Can I take money early from all types of pensions?

You can take money from any private pension and most employee schemes, although final salary (also known as defined benefit) schemes may need to be transferred to a personal scheme first. You cannot use pension release to take money early from the state pension or unfunded public sector schemes which cover organisations and professions including the NHS, teachers, armed forces, civil servants, firefighters and the police.

Is taking money from your pension the right thing for you to do?

Before taking the first steps in beginning the pension release process, you first need to balance the importance of what you currently need with what you might need in the future.

Taking money from your pension now could reduce your income and therefore affect the way you live your life when it is time to retire. On the flip slide, for many people considering this option, resolving their current need can have a lasting positive impact on their future.

It is not an easy decision to make. And that is why many people seek advice from a regulated, independent financial adviser, someone who knows pensions inside out and who will do all of the hard work for you.

How do I start the process?

This all depends on the type of pension, or pensions, that you have. Sometimes you can make the arrangements direct with your provider. In many cases, though, you must take financial advice before withdrawing any money early from your pension. This regulation is in place to protect people as, depending on your circumstances, transferring out of certain schemes might not always be in your best interests.
We have already helped thousands of clients to withdraw the money they need, and for many others we have recommended they are best off leaving their pension savings exactly where they are. The great thing is it costs you nothing to find out which option we believe is right for you. 

Request your information packRequest your free information guide

Our free information pack will help you navigate your way through releasing tax-free cash from a LGPS. Complete the quick and easy enquiry form we have enclosed and we will send you all you need to know about taking the next step. We will also let you know how our no obligation guidance and advice works and how to take advantage of it..

More information…

Below are the answers to a range of other questions that people commonly ask. If you can’t find what you are looking for here, then it is probably best to give us a call. Some things are easier to explain over the phone, rather than trawling through lots of text on a screen, and that is what we are here for.

Why are so many people taking money from their pension before they retire?

Thousands of people across the UK are taking money from their pension pot early to tackle a current pressing need or opportunity. In our experience, some of the most common reasons include:

  • Tackling a long-standing financial commitment such as a mortgage, loan or credit card.
  • Supporting a family member with a big life event such as a wedding or deposit.
  • Making important upgrades to the house.

These are just a few examples and you might have a completely different reason for wanting to take money early from your pension. One thing that you need to consider is that this option isn’t suitable for everyone, and it’s important to seek financial advice before making any decision.

Is there a cut-off age, after which I cannot take money from my pension?

No, as long as your savings are invested in a pension that allows you complete access then you can take money from your pension whenever you want to.

Am I going to have to pay the tax man?

You can take the first 25% of your pension pot tax free*. After that withdrawals are taxed. The amount you are taxed depends on which tax bracket you fall into once all of your income sources, including any money that you take from your pension (and excluding tax free cash), have been added up*.

What will it cost me?

Aside from any tax that you might have to pay, most companies will charge you to arrange and manage any withdrawals of money from your pension pot. Many adviser firms will also charge a fee to review your circumstances and make a recommendation for your pension. Others, like us, will only charge a fee if you ask us to act on our recommendation. And you won’t have to find the money for this fee, it will come out of your pension.

When do I have to seek financial advice before taking money early from my pension?

If you have built up more than £30,000 worth of contributions into either a company final salary pension (also known as defined benefit schemes), or a pension with a guaranteed annuity rate, then you must take advice before withdrawing any money early from these types of schemes.

Call 0800 304 7288 for a friendly chat about your pension

Stephen's pension documentary

Stephen finished his documentary

Documentary-maker Stephen took money from his pension to complete his long-in-the-making documentary “After ‘82”, which explores the history of the AIDS crisis in the UK. Click the link to watch Stephen's story.


Watch the video

Alan's pension release story

Pension cash enabled Alan to clear debts

Alan had credit cards charging high rates of interest. Taking some tax-free cash from one of his pensions allowed Alan to clear the cards, and the rest remained invested for the future. Click the link below to watch Alan's story.


Watch the video

Finding Mark's pension

Finding old pensions changed Mark’s future

Mark wanted us to find his pensions from previous jobs. Tracking them down gave him almost £20,000 more for the future. We then combined them into a single pension fund, giving more control than before. Click the link below to watch Mark's story.


Watch the video

Frequently asked questions

Important information

Tax treatment depends on your individual circumstances and may be subject to change

Back to top