Turning your pension fund into an income for retirement

Turning your pension fund into an income for retirement

When you’re nearing your selected retirement date, you will have a number of choices and decisions about how you want to convert your pension fund into an income for retirement.  The things you need to consider will be made clear in a “wake-up” pack your provider will send you four to six months before your selected retirement date. 

Around six weeks before you plan to retire your provider will also send you an estimate of the value of your pension fund.  They should also tell you how much retirement income you can expect to receive if you decide to buy a lifetime annuity with them.  A lifetime annuity converts your pension fund into retirement income that will be paid to you for the rest of your life.  You don’t have to buy your annuity from your pension provider.  You can shop around (it’s known as the open market option) for the best annuity deal.  You can compare annuities through the FSA’s Online Annuity Table at http://www.fsa.gov.uk/tables/

You can also seek advice from an independent financial adviser, who can also help you decide which retirement income option best meets your circumstances.   You can find an independent financial adviser in your area through  http://www.unbiased.co.uk/

 

So, how can you turn your pension fund into an income for retirement?