How to take your pension: a step-by-step guide

You can check your State Pension ageOpens in a new window on GOV.UK to find out the earliest you can claim your State Pension.

For other types of pension, you can usually choose to take your money at any point from age 55 (57 from April 2028), or younger if:

• you need to retire early due to ill-health, or
• your pension scheme rules list a lower protected pension age.   

But you’ll normally get less if you take your pension before your scheme’s normal pension age (NPA) – this is when your pension is usually designed to pay out at.  

You can find your NPA in your scheme documents or by asking your provider, but it’s often around age 60, 65 or the same as your State Pension age.

For more information, see our guide When can I take money from my pension?

If you cannot find details for a pension scheme or are having difficulty contacting the provider, see our step-by-step guide How to find old or lost pensions.

Deciding when to retire often depends on when you can afford to stop working.

You can usually find an estimate of your pension income by:

• logging in to your provider’s online account
• checking pension statements you’ve received
• contacting your provider.

To see how much State Pension you’re on track to get, you can check your State Pension forecastOpens in a new window on GOV.UK.

For more help, see our guide How to calculate your estimated pension and retirement income.

You can use our Pension calculator to see how much retirement income you might need and how much you’re likely to get from your pensions.

You can also see how your estimated income might rise or fall if you change:

• how much you pay in
• your planned retirement age.

It’s also a good idea to create a retirement budget listing everything you might still need to pay. To help, you can use our:

• Budget planner
• Budgeting in retirement worksheet Opens in a new window (PDF, 74KB)

If you’re confident you won’t have a mortgage or rent to pay in retirement, the Retirement Living Standards lists how much income you might need each yearOpens in a new window for different types of lifestyles.

For more information, see our guide How much money do I need for my retirement?

There are many ways you can increase your retirement income, including: 

• paying more into your pension – your employer might also match your contributions
• checking you’re getting all the tax relief you’re eligible for
• making sure you’re on track for the maximum State Pension
• delaying your retirement date.

For more information, see our guide Ways to boost your pension.

How you can take your pension depends on the type you have. You can use our tool to find out your pension type or ask your pension provider.

If you have a defined contribution pension, you can usually choose how you’d like to take your money.

Your options normally include taking up to 25% as a tax-free lump sum and:

• leaving the rest invested so you can take taxable income as and when you need it – called pension drawdown
• convert some or all of the rest into a taxable guaranteed income – called buying an annuity.

You don’t have to take the full 25% as a tax-free lump sum, or any at all. The more you take, the less you’ll have to give you an income later.

Alternatively, you could take your pension in one go or as multiple lump sums, with up to 25% of each amount paid tax-free.

For more information, see our guide What can I do with my pension pot?

If you have a defined benefit pension (often called final salary or career average schemes), you’ll usually get a guaranteed monthly income for life. This is normally taxed along with any other earnings you have.

You might also be able to take up to 25% as a tax-free lump sum when you start taking your income. Depending on your scheme, this will either mean your guaranteed income will:

• stay the same – if you’ve built up a separate amount for a lump sum
• reduce – as you’re converting future income into a lump sum to take now.

If your guaranteed income will reduce, you’ll need to weigh up if you’ll gain more overall by taking the money now – and if you can afford to live on the lower regular amount.

If the value of all your pensions is less than £30,000 or one is worth less than £10,000, you might also have the option to take your pension in one payment.

You can usually take up to 25% of your pension without paying tax, as long as the total amount of tax-free cash paid from all your schemes is not higher than the lump sum allowance (LSA). The LSA is £268,275 for most people.

Find out more in our guide How tax works on pension income.

You can contact our pension specialists for free help and guidance – it does not matter what type of pension you have or how old you are.

When you’re ready to start taking your pension, you’ll need to contact your pension provider and tell them what you’d like to do.

You can find pension contact detailsOpens in a new window on GOV.UK.

If you have a defined contribution pension, it’s always worth comparing providers to make sure you’re getting the best deal.

For example, if your current provider does not offer an option you’d like (like taking multiple lump sums), you could consider transferring to a provider that does.

You can use our:

• annuity comparison tool to check if you can convert your pension into a higher guaranteed income with a different provider
• pension drawdown comparison tool to see if other providers charge lower fees or offer more suitable investment options.

For more information, see our guides about:

• How to find the best deal when taking your pension
• transferring your defined contribution pension.

You could also consider paying a regulated financial adviser to recommend suitable products for you.

Do not access your pension or transfer any money to a pension provider because of a cold call, visit, email or text. It’s likely a scam designed to steal your money.

You might lose all your retirement savings and have to pay an expensive tax bill.

For more information, see our guide How to spot a pension scam. 

You should get an invitation code by post around four months before you reach your State Pension ageOpens in a new window

If you have not received it three months before this, or you’ve lost it, you can request an invitation codeOpens in a new window on GOV.UK.

You can then use your invitation code to apply when you’re ready – there’s no time limit. You might even get more if you delay your claim.

Always check if you’re entitled to Pension Credit to boost your income. Even if you don’t qualify for much extra money, it can make you eligible for other grants and help.

You can use our Benefits calculator to see what you’re entitled to or find out more in our guide about benefits in retirement.