🌟 #PensionQuestion 🤔 Hey everyone! 💬 I came across an interesting query that got me thinking 🤯: Can I take my pension at 55, then restart my pension with work based contributions? 🕰️ And eventually cash in the second pension at 65? Here’s what I found out:
Here’s the gist of it:
– Buy an annuity at 55 🎉
– Continue working and contributing to a pension for another decade 💼
– Cash in the second pension at 65 💰
As far as I know, you can take your pension at 55 and then continue working and contributing to a new pension scheme. This strategy could potentially give you more financial flexibility in the long run. 🤑
What are your thoughts? Any additional insights or experiences to share? Let’s discuss! 🔍💬 #RetirementPlanning #FinancialFreedom #AnnuityBenefits
In principle yes but you may have to navigate your employer’s options. Failing an option to do it seamlessly, you could always opt out, transfer out and purchase an annuity and then rejoin the employer scheme. Buying an annuity wouldn’t trigger the MPAA but that’s something to be careful of (ie don’t take drawdown instead etc). Not advice!
I think would be a question for your particular provider or you could contact:
[https://maps.org.uk/en#](https://maps.org.uk/en#)
You can but why?
What would you achieve (other than a less efficient use of your existing pension pot)?
In theory yes, assuming you’ll be 55 before the rules change in 2028. But you might be subject to the [Money Purchase Annual Allowance](https://www.moneyhelper.org.uk/en/pensions-and-retirement/tax-and-pensions/money-purchase-annual-allowance-mpaa) (meaning that you can contribute a maximum of £10k per year to your second pension). I say “might” because it’s complicated, and the rules depend on whether the pension schemes you’re talking about are defined contribution or defined benefit.
Whether that’s a sensible thing to do depends on all sorts of things. If you’re over 50 already you might benefit from a chat with [Pension Wise](https://www.moneyhelper.org.uk/en/pensions-and-retirement/pension-wise).
You’d probably be better off taking the 25% lump tax free and using that to cover your loss in wages rather than buying an annuity.
Also you have to speak with your employer and confirm they will let you drop your hours at 55, most I have worked for don’t tend to let you start dropping your hours until your 2-3 years from retirement age
Only to add to the conversation.
If you were in a defined benefit pension you wouldn’t be able to take it while you are currently employed in the position the pension is attached to.
If you had a deferred pension you would be able to take it though, with a reduction for early payment and probably a higher tax liability as a second income.
However from context is suggests that it’s a defined contribution pension being discussed.
I am doing this with my railway pension, I’ve gone onto a job share (2 weeks on, 3 weeks off) at 52, I can take my rail pension (plus the AVC) at 55 with a large lump sum, then I’ll get re enrolled in the work pension, start the AVC again then I’ll take another pension when I actually finish work.
As others have said, you’d be better off taking your 25% tax free allowance and using that to fund the delta.
You could do what you’ve suggested but it might get messy if it’s all in the same role compared to doing what my own father did – taking VR, getting a lump sum and then taking his pension from 55 and then getting a different job which he then contributed into.
If it’s the same job you’re in then it’s worthwhile speaking to your employer and the provider on their terms as some will be OK with it and some may not be.
Also as others have said, you’ve the right to request reduced hours but the business can say no if it inconveniences their operation.