I talk to people every day about taking tax free cash out of their pensions, A light bulb comes on when you hit the magic number of 55, I know it does because it did with me. I woke up on my 55th birthday and amongst the ‘god I’m getting old’ thoughts, the tax-free cash question crossed my mind! …human nature I suppose.
Over the years I’ve facilitated tax free cash payments for several camper vans, classic cars and sundry house improvements. I’m a big fan of living for today but the adviser in me always discusses the other options available, so here goes just in case your magic number has just come up and a campervan was on your mind!
5 things to prod your conscience with before you say, ‘sod it’ and do it anyway!
1. Can you borrow against your property, I know your 55 but it’s still possible, and mortgage rates are pretty low.
2. If you have money on deposit, compare your deposit interest to your pension interest (growth). People have a habit of drawing money from pensions because savings accounts are easier to understand and pensions are rubbish aren’t they?
3. Always talk to an adviser. Most companies should have a go to adviser you can have a natter with. If the adviser doesn’t try to persuade you to look at other options first have a chat with somebody else, our job is to make you look at alternatives first.
4. I know you probably don’t feel like it at the moment, but the likelihood is that you are going to live to a ripe old age, so get an idea of the impact of taking the tax-free cash now is going to have on your retirement income.
5. I know you are going to do it anyway, you can, it’s your money, you’ve worked hard for it, so you’re gonna enjoy it…… but If you are doing it anyway please have a chat with us first, at least we can inform you of the best options.
Just give us a call on the numbers below before you sign on the dotted line for that camper van
*Note: As a mortgage is secured against your home or property, it could be repossessed if you do not keep up the mortgage repayments.Publish date: 4th February 2021