Changes to the rules that govern how you can take your pension

In April 2015, new pension rules come into force. These changes, based around the Chancellors budget of 2014, will have a wide ranging impact on many people taking money out of their pensions.

The rules affect those with a defined contribution pension; usually referred to as a Personal Pension Plan. The change of rules could also apply to those who have a funded defined benefit pension scheme but not those who have an unfunded scheme.

The changes to pensions have been hailed as being revolutionary; ground-breaking and even exciting!

There are so many changes and implications that it is impossible to cover them in one blog.

We therefore intend to issue a series of blogs and updates with each one dedicated to a particular strand of change to the rules. For example, we will look at

  • Who stands to benefit from the proposed pension changes of 2015
  • Can I cash all my pension in (and buy a Lamborghini)
  • How a pension can be used for intergenerational planning
  • How a pension can be made to provide a higher level of income than would have been available under the old rules and what impact this might have overall
  • Why making the right decision at the outset is so important and the dangers of making a wrong decision
  • How to be smart about accessing a pension to take maximum advantage of the 2015 changes
  • Why it is so important to check who is nominated as your beneficiary when you die
  • Why a pension may be a better proposition than an ISA.

Another strand to the changes is that everyone is now to be provided with free guidance on what their options are. Supplied primarily by the Citizens Advice Bureau and the Pensions Advisory service, those who are reaching their selected retirement age will be able to get guidance on what their options are. It is important to understand that guidance differs from advice. Advice is usually based on your own situation and requirements taking into account all the options available whereas guidance is more generic and not necessarily tailored to your own situation.

The need for advice has never been so great; a wrong decision could be costly and irreversible. There is more choice but also an added complexity to the whole situation and could lead to more questions than answers.

BLM will continue to offer its ‘pensions options at retirement’ advice service and expects high demand from existing and new clients faced with more options than ever before.

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If you require advice rather than guidance, BLM can assist you by clicking here