Changes to pension rules

The UK pensions system will be drastically reformed on 6 April 2015. We look at how the changes will impact on savers and investors.

The main changes concern how people access their pension.

From age 55, you will have greater choice and flexibility in accessing your pension and, although it may still make sense for many, it will no longer be necessary to buy an annuity in order to provide an income from your pension pot.

Instead, if you do not need the income, you may wish to leave your pension savings invested.  You may choose to invest in other (non-pension) products, which offer the potential for you to benefit from investment growth and income, although unlike an annuity, income from such products is not usually guaranteed

It will also be possible to take money out of a pension in cash and use it for other purposes, for example, alternative investments such as buy-to-let property. This money could equally be used to pay off debts, transferred to other family members, or for general spending.