Managing Your Money 

How to avoid pension freedom dangers

Pension freedoms introduced in April 2015 were supposed to benefit investors by increasing the flexibility of their retirement fund, for example, allowing those over 55 to cash in their entire defined contribution pot. Other options include the ability to take up to 25 per cent of your pension as a tax-free lump sum, known as an uncrystallised funds pension lump sum (UFPLS), although anything you take over this amount is taxed as income. But you can move the rest of the money into investment funds, which will pay out a regular taxable income.

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