Solihull, West Midlands (PRWEB UK) 4 April 2014
Solihull based pension promotion website, Understand Your Pension are calling for more people to be aware of the changes made to pensions in the 2014 Budget. From April 2015, retired people will have a much greater flexibility in accessing their hard-earned pension savings during retirement. Up until the budget announcement, people would be charged 55% tax if they chose to withdraw their whole pension pot, whereas in the future, people aged 55 and above will pay only marginal income tax on any withdrawal.
In the meantime, as of 27th March 2014, before the full changes come into account, the amount of pension wealth that people will be able to withdraw as a lump sum will increase from £18k to £30k. As the amount of guaranteed income needed in retirement in order to access flexible drawdown of their pension pot has reduced from £20k per year to £12k per year, this means that up to 400,000 more people will have the option of flexible access to their savings over the next financial year.
Understand Your Pension want to make people aware that although they have much more flexibility in drawing down their pension, it is still important for them to consider distributing their pension wealth wisely to ensure that they have enough finances to last their retirement.
Understand Your Pension Managing Director, Tim Ogan said “With the 2014 budget changes giving people a much greater choice in pensions, with a considerably greater freedom to choose how and when they access their wealth during retirement, we call for those worried about how the changes will impact on their pension scheme to contact Understand Your Pension.”
Anyone wanting help making sense of budget changes and explaining the advantages and drawbacks of the added flexibility of pension withdrawals can contact Understand Your Pension through their website.