For some people they want this to be as early as possible. Current rules mean that the earliest someone can draw an income from their pension is age 55 but this is set to move to age 57 in 2028.
The above are only minimum age to access pensions but the bigger question would be ‘have you accumulated enough wealth to provide you with your required income for the rest of your life’. This could be cash savings, ISA investments, and property etc.
The earlier you retire the less time your pension has to grow but also the longer the pension will have to pay out for. You therefore have to decide if your pension is big enough to last the remainder of your life and do you have any other assets that can help provide your retirement income.
By having a solid financial plan in place and undertaking regular reviews with your Wealth Planner you will be able to understand what your retirement might look like and the commitments you need to make in order to achieve the retirement you desire.
This is different for everyone as it depends on the lifestyle you wish to lead and what you want to use your pension for. Some people want to live off the income so that they can leave a legacy while others want to use their whole pension fund for their retirement. . There are different ways to use your pension to provide an income in retirement, you could use it to buy what is called an annuity, this is where you exchange your pension for an income stream which can be guaranteed for life. As an alternative, you could use your pension as an investment that you can make regular withdrawals from. The problem with the later approach is that we don’t have a crystal ball to determine our life expectancy, so if you draw too much, too early, you might run out of funds. Having a cash flow model can also help map this out using Office of National Statistics data, i.e. the average male / female will live until xxx
Careful planning is essential. If you only take the natural income from your pension, in theory it would last throughout your retirement, but is the natural income enough? Having cash savings to fall back on in years of market poor performance is essential.
Your retirement income can be derived from a number of sources including but not limited to your pension income, property rental income, ISA’s, general investment accounts, bank accounts and offshore and onshore bonds. It depends on how many different pots you have access to. Retirement planning can be complicated, so if you are not sure on the approach to take to provide your income in retirement, it is best to obtain professional financial advice.