Getting a tax-free lump sum is one of the biggest perks of paying into a pension.
Savers typically use their 25 per cent tax free cash to clear remaining mortgages, splash out on new cars, home renovations and trips abroad or even to ease the strain of day-to-day living costs.
But not everyone should rush to cash in when they reach their mid 50s. Withdrawing the money too soon could leave you thousands of pounds worse off in the long-run.
Currently, those over the age of 55 (rising to 57 from 2028) can take 25 per cent of their pension pot tax-free up to a £268,275 cap.
Savers withdrew a colossal £3.9 billion in pension lump sums in the 12 months
To provide well-rounded coverage and a breadth of insight across various events, we rely on contributions from several staff writers, each bringing their own area of expertise to our publication.
