News & insights

Road to retirement

Stepping into retirement can be scary, with many seemingly complicated decisions ahead of you. If you are nearing retirement age, how ready you are to take the plunge?

Category: Insight


Retired Couple Using Laptop

What age do I want to retire?

Everyone decides when they are ready to retire at different times of their life.

For some, it may be as soon as you are able to access your workplace pension at age 55 (or age 57 after 6 April 2028). This, however, may mean that you receive a lower income as your pension pot will be stretched over a longer period of time.

On the other hand, if you wait until later in life, you could collect a higher income as your money will be paid over a shorter timeframe and you will have contributed more to your pot.

Something worth bearing in mind is that you’ll also be eligible for a state pension at age 65 (age 67 after 6 April 2028), provided that you have paid at least 10 qualifying years of National Insurance payments.

“Qualifying years” are those in which you pay National Insurance when you are working, or where you have contributions credited to you for years when you are unable to work.

In order to reach your maximum state pension of £221.20 per week (as of 8 April 2024), you must have at least 35 qualifying years attributed to your name.

Ultimately, how and when you take your savings is entirely up to you, and depends on your personal needs and circumstances. It can help to regularly check the value of your savings and use our modeler tool, in your Retirement Savings Account, to see how much you’ll have saved by the time you want to retire.

Understanding your financial situation will help you create a better picture of what retirement might look like for you, and how long you’ll need to work to get the lifestyle you want.

To get started, you can take our interactive video quiz, which uses the PLSA’s Retirement Living Standards to identify the type of lifestyle you’d like in retirement, and how much it could cost you. By comparing this cost to the amount you’re likely to have saved, you’ll be able to see any gaps you need to fill.


How many pensions do I have (and do I know where they all are)?

If you’ve started to think about when you want to retire and what it’s going to cost you, the next thing you should be asking is how many pensions you have and if you know where they all are.

If you’re coming to retirement age, it’s likely that you’ve had a few jobs across your working life, and you might have multiple pensions. Due to auto-enrolment in workplace pensions (which took effect in 2012), you could have small sums of money stashed away from positions you only held for a brief time.

Unfortunately, pension information can easily go missing for a number of reasons, including:

  • Moving address;
  • Misplacing paperwork;
  • Changing email address or phone number, etc.

Currently, there’s over £26 billion in lost pensions floating around, which have not been claimed by people as they moved into their later life.

Fortunately, you can solve this problem by contacting your previous employers or utilising the Government Pension Tracing Service.

Once you have found all your pension pots, you can then decide whether you would like to keep them separate, or, consolidate them into a single pot.

For more information on tracing lost pensions, click here.


What options do I have for taking my pension?

You have several options for taking your money when the time comes. It may be the case that you delay your retirement and leave your money invested in your pot until you need it.

There are, however, a number of ways you can take your TPT savings:

  • Receive your entire pension in one go - You can take your savings as one lump sum, with 25% of the amount paid tax-free.
  • Receive a flexible income - You can withdraw up to 25% of your funds tax-free, either in a lump sum or in instalments. The remaining balance will enter a "flexible-access drawdown." This money will then be available for withdrawal whenever you choose, with the rest still having the chance to grow in your retirement savings account.
  • Receive a guaranteed income (annuity) - You can purchase an annuity, which means receiving guaranteed income using all or some of your savings, either for the rest of your life or for a fixed period of time.
  • Receive multiple lump sums - You can take your savings a little at a time, in lump sums as and when you need them, with 25% of each amount paid tax-free.

It’s worth noting that once you turn 55, you may access your retirement savings to supplement your current income or take a lump sum. You don’t need to be fully retired to take your money. In fact, many people use their retirement income to slowly reduce their working hours over time to allow them to spend more time doing the things that they enjoy.

Bear in mind that if you begin to take money from your defined contribution pension pot, the amount that you can contribute whilst receiving tax relief might reduce. This is known as the Money Purchase Annual Allowance.

It’s all about doing what’s right for you.

You can also see the advantages and disadvantages of each option, and the risks you should bear in mind, on our website.

How do I take my pension?

We’ll send you a detailed outline of your options six months before your planned retirement date. This is the date that you’ve previously told us you’d like to retire, but you might find that this changes over time. You can check and update this in your Retirement Savings Account, to make sure we get in touch with you at the right time.

If you’re not ready to take your savings when we send your retirement pack, you don’t have to. Just contact us to tell us this and we’ll keep your savings invested.


Should I get some professional guidance?

It's important to be well-versed in your withdrawal options before you start spending your funds. There is a lot to consider, so it could be a good idea to acquire some expert assistance in the form of financial guidance or advice.

A financial advisor can be a great help when trying to understand how to make improvements to your savings and investment strategies. There is a cost for such services, but it can be useful as it will provide you with tailored advice and a recommended course of action that’s bespoke for your personal circumstances.

With the assistance of a financial advisor, you can feel more confident in your retirement savings plans, make educated decisions on your pension funds, and prepare adequately for the financial needs of retirement. You should consider getting financial advice if you’re:

  • Unsure how much you need to save to support the retirement lifestyle you desire
  • Considering consolidating your TPT pension with any other pensions you may have, or are transferring your current pension
  • Looking to make any changes to the way you invest your savings

Financial advice is available to TPT members through our carefully selected partner, Origen Financial Services. Origen’s financial advice is entirely independent from TPT, and will be based on your own personal circumstances, aspirations and financial objectives. Click here to find out more.

You may opt to seek financial guidance before seeking financial advice. The government requires that you consider booking a free guidance appointment with Pension Wise to assess your options.

Your appointment with Pension Wise can be in person or over the phone. Pension Wise offer a 45-minute session to talk you through your retirement options and help you make sense of them.

TPT have also partnered with Mercer, a leading provider of retirement guidance, to offer you with information about your pension options. You can speak with one of their Retirement Relationship Managers as part of this service, and they will:

  • Offer a free consultation (usually 45 minutes) to discuss your options.
  • Help you agree your next steps, ensure you have the proper documents and help you accomplish it.

Keep in mind, however, that guidance services will only supply you with general information. It is not based on your unique circumstances and will not provide you with a personalised recommendation on the best course of action for you.

You can find out more about ways you can access guidance and financial advice on our website.

Related news & insights