What is Phased Retirement?

Phased Retirement is a form of taking your pension benefits at different times. This can be achieved by taking benefits from different policies at different times or segmenting a single policy. 

What are the Phased Retirement options?

By cashing in segments of a policy as pension benefits (i.e. crystallising benefits), the Phased Retirement scheme member can decide how much income they require in the short term, and leave the uncrystallised funds remain invested until they are required, or delay the purchase of a lifetime annuity until such time a higher annuity rate is available.

Taking the funds tax free cash at the outset is not a possibility with phased retirement, as each segment will contain a component of the tax free cash.

Why should I consider Phased Retirement?

There will be reasons specific to an individual’s personal circumstances to taking benefits by Phased Retirement.

For instance, Phased Retirement is currently not available to final salary (defined benefit) schemes unless they transfer out to a scheme that does permit it.

There are several other issues relating to a clients death benefit requirements, access to tax free cash and income in the short term balanced against the income requirements in the longer term that also need to be considered.

How can I take Phased Retirement?

The first and most important step after you have decided you may want to take retirement income or transfers to pension arrangements that allow the desired retirement income option to be taken by Phased Retirement is to have a discussion with us to provide you with independent financial advice.

Once we have agreed what the most suitable type of phased retirement option is for your particular circumstances at the acceptable level of risk you are prepared to take to match your needs as part of the pension planning process.

We then make an application on your behalf to commence pension benefits or transfer existing arrangements into an appropriate scheme based on how much income required, the size and composition of the fund and the benefits available from the scheme providing the retirement benefits including all other existing pension schemes or deferred schemes, and your personal tax situation.

Want to know more?

Talk to one of our qualified financial advisers on 01553 777600 or e-mail us at enquiries@ringassociates.co.uk

Also you may want to read the articles associated with Pensions and Retirement from the Financial Services Authority website at http://www.moneymadeclear.fsa.gov.uk/products/pensions/pensions.html and http://www.moneymadeclear.fsa.gov.uk/tools/stakeholder_pensions/notes_index.html

Also you can download the free booklet ‘Just the facts about pensions’ from the same website at

http://www.moneymadeclear.fsa.gov.uk/pdfs/pensions.pdf

Additionally you can download the booklet ‘Just the facts about retiring soon’ at http://www.moneymadeclear.fsa.gov.uk/pdfs/retiring_soon.pdf

and also the booklet ‘Just the facts about your retirement options’ at

http://www.moneymadeclear.fsa.gov.uk/pdfs/retirement_options.pdf

and the booklet ‘Just the facts about your retirement options – income withdrawal’ at

http://www.moneymadeclear.fsa.gov.uk/pdfs/income_withdrawal_ink.pdf

and articles on phased retirement option at http://www.moneymadeclear.fsa.gov.uk/products/retirement/types/other_retirement_options.html