While you generally cannot make direct withdrawals from an existing ReAssure pension without taking the entire pot as a lump sum, ReAssure provides flexible options to access your funds, primarily through their Retirement Account.
Understanding Your ReAssure Pension Access Options
Accessing your pension funds involves specific rules and considerations, especially regarding tax and how you wish to manage your retirement income. ReAssure offers two main pathways for individuals looking to "cash in" or access their pension money:
1. Taking Your Pension as a Full Lump Sum
It is possible to withdraw your entire ReAssure pension pot as a single lump sum. This option means closing your pension plan with ReAssure.
- Key Considerations:
- Tax-Free Cash: Typically, the first 25% of your pension pot can be taken tax-free.
- Taxable Income: The remaining 75% will be added to your income for that tax year and taxed at your marginal rate. This could push you into a higher tax bracket.
- Loss of Future Growth: Once withdrawn, the money is no longer invested within the pension wrapper and will not benefit from future investment growth or tax advantages.
2. Using the ReAssure Retirement Account for Flexible Access
To offer more flexibility and allow customers to manage their retirement income without withdrawing everything at once, ReAssure has introduced the Retirement Account. This account allows you to keep your money invested while providing access through popular pension flexibility rules:
- Uncrystallised Funds Pension Lump Sum (UFPLS): This allows you to take ad-hoc lump sums directly from your pension pot without having to move it into drawdown first. For each UFPLS withdrawal, 25% is usually tax-free, and the remaining 75% is taxable.
- Flexi-Access Drawdown: This option allows you to move your pension savings into a drawdown pot. You can then take a tax-free lump sum (usually up to 25% of the amount designated for drawdown) and then take taxable income payments directly from the invested pot whenever you need to. Your remaining funds stay invested, with the potential for further growth.
| Access Option | Description | Key Features |
|---|---|---|
| Full Lump Sum | Withdraw your entire ReAssure pension pot in one go. | - Up to 25% typically tax-free, the rest is taxable income. - You cease to have a pension with ReAssure. - Loss of future investment growth and tax benefits within a pension. |
| Retirement Account | Transfer your pension into a flexible arrangement, allowing access while funds remain invested. | - Access via UFPLS (part tax-free, part taxable lump sums) or Flexi-Access Drawdown (initial tax-free lump sum, then flexible taxable income). - Funds stay invested with potential for growth. - You control when and how much you withdraw, offering greater tax planning flexibility. |
Benefits of the Retirement Account
The ReAssure Retirement Account is designed to provide greater control over your pension savings in retirement. By utilizing options like UFPLS and Flexi-Access Drawdown, you can:
- Maintain Investment Growth: Your money remains invested, allowing it to continue growing, potentially providing more income over the long term.
- Flexible Withdrawals: You can choose when and how much money to withdraw, tailoring your income to your needs.
- Tax Efficiency: By managing your withdrawals, you may be able to control your taxable income more effectively, potentially reducing your overall tax liability compared to taking a large lump sum all at once.
To explore these options further and understand how they might apply to your specific ReAssure pension, you can find more information about leaving your money invested with flexibility on the ReAssure website.
