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Should I take my pensions tax-free cash at age 55?

This investor may retire in two years' time at age 55
August 27, 2021 and Martin Collins
  • This investor may retire in two years
  • Taking his tax-free cash entitlement could help finance this
  • Holding assets which are not correlated to equities could help to diversify his investment portfolios
Reader Portfolio
Douglas and his wife 52 and 46
Description

Sipp and Isas invested in shares and funds, cash, residential property.

Objectives

Retire at age 55 or 62, maintain or increase current level of income between ages 55 and 70, draw net income of £48,000 a year from investments if retired at age 55, cover large expenses, give each child up to £150,000 to buy a home, mitigate effect of breaching pensions lifetime allowance, decide when to take pensions tax-free cash entitlement, allocate Sipp and Isa correctly to meet investment goals. 

Portfolio type
Investing for goals

Douglas is 52 and earns around £40,000 a year after tax. His wife is 46 and earns £140,000 a year. They have two children in their early teens. Their home is worth about £900,000 with a mortgage of £275,000.

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