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Should I take my tax-free lump sum early?

28 replies

MillicentFaucet · 04/03/2026 19:26

I was planning to glide towards retirement from next year but I'm a bit worried that another shake up of pension rules may be on the cards for the autumn budget,
specifically around lump sums. I know it was floated last time and didn't happen but I think it it's on the cards eventually.
I've asked the provider of an old DB pension for my figures & think it'll be about £70k.
Am I being paranoid or should I take the cash before RR helps herself to a slice of it?

OP posts:
MillicentFaucet · 05/03/2026 10:44

DashingDanton · 05/03/2026 08:18

What’s the commutation rate, op?

I don't have the figures to hand but I think I worked it out at about 25ish.

As I said in my OP it's more about my feeling of general unease around how & why this government make their fiscal decisions. I'd love to feel confident that any major changes would be implemented with adequate warning, but I don't. Maybe I'm just a bit unsettled by how the world looks atm and having this particular pot of £ now will give me a little more control and reassurance (even if I end up paying a few extra £ in tax)
I have other income and other pensions so even if I'm wrong about this it's not the worst decision I've ever made.

Thanks for all your comments though, I'll probably hang back until later in the year, give RR a chance to steer the economy toward strong growth & full employment lol

OP posts:
SparklingWater0Calories · 05/03/2026 10:52

That's a very good rate. I'd be tempted to do the same as you, op, and also suspect that it's the wrong thing to do 😂

messybutfun · 05/03/2026 10:58

ifonly4 · 05/03/2026 08:15

One thing that might impact whether you do something immediately or in a few weeks, is that you'll probably find your pension pot has reduced in recent days - mine was £70,400 Monday morning, yesterday is was £68,438.

Can anyone shed light on what rules could change around pensions. I'm in a similar position to OP, and was thinking about taking my lump sum within a year.

A DB pension doesn’t have a value as such. But while they are still working their entitlement to a lumps sum will be increasing depending on what scheme they are in.

Most DB schemes require you to take your pension at the same time as your lump sum.

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