Options for taking your pension account and how to apply
Your pension account will be used to provide benefits when you retire.
The value of your pension account depends on:
- how much you, and your employer have paid into your pension account
- how the funds you have invested in perform
- any charges which are deducted from your pension account
There are a number of different choices you can make about how, and when you decide to use your pension account. Select from the topics below to see a summary of your options, along with details of how to apply to access your pension account when you are ready to do so.
When to retire
There are a number of different times you can choose to use your pension account. You can read a summary below. For more information, please check your UPP key features document, or contact Fidelity’s Pension Service Centre.
Default retirement age
Voluntary Early Retirement
You may be able to access your pension account before you reach your default retirement age (see above).
If you are planning to access your retirement savings early, it is important to remember that your UPP pension account will have had less time to grow, so your savings and other benefits may be lower than if you accessed your pension account later.
If you are considering accessing your pension benefits but want to continue contributing to other pension arrangements you need to understand your position in relation to the Money Purchase Allowance.
Late Retirement
You do not have to access your pension account by a certain age. However, if you want to continue working and access your pension account after age 75, specific rules may apply.
If you are thinking about taking your pension account after age 75, we would encourage you to take financial advice. You can find more information below and on the help and advice page.
Ways to take your UPP pension account
You may take up to 25% of your account as a tax-free lump sum
There is a maximum amount of tax-free cash you can take from your pension savings in your lifetime. This is called the Lump Sum Allowance (LSA). Some people might have a higher allowance if they also had a higher protected Lifetime Allowance. Visit the tax allowances page to find out more.
You can then choose what to do with the remaining fund in your pension account, which will be taxed as earned income.
Depending on government limits, you may be able to:
Leave some of your pension account invested and take an income from it. This is known as flexi-access drawdown.
You can leave some of your account invested and take an income from it at the same time. You choose how much you want to withdraw and when, which could offer you more flexibility.
You can access a drawdown facility through the UPP administrator, Fidelity, or transfer to another provider.
You can learn more about transferring your pension account on the transfers and scams page.
Get a regular, secure income, known as an annuity.
You can use your pension account to purchase an annuity. An annuity is a policy that gives you a secure, regular income for life, or for a fixed period of time.
You should shop around to find the best options to suit the lifestyle you want in retirement. Keep in mind that the income you will receive, the additional features and the fees you need to pay, can vary widely from provider to provider. There may also be different terms regarding eligibility.
To help find the right provider for you, you can try MoneyHelper’s free annuity comparison tool.
You may also want to take financial advice, to discuss your options and choose an annuity provider that is right for your personal circumstances. You can learn more about this below and on the help and advice page.
Take ad hoc cash lump sums. This is known as encashment.
If you choose to take ad hoc cash lump sums, you should speak to Fidelity to understand any conditions in relation to those withdrawals. For example, there may be a minimum amount you can withdraw and a maximum number of withdrawals you can make before incurring a charge.
If you choose any money in your pension account as a cash lump sum under encashment, this is considered separate from any tax-free cash lump sum that you take.
You can choose one, or a combination of these options. Choosing a combination may help you achieve a retirement plan that is best suited to your personal circumstances.
You can read more about your options in your UPP key features document.
Getting help making the right decision for you
Fidelity’s Retirement Service can help you review your retirement options and help you to make a plan that is right for you. Call 0800 368 68 68.
PlanViewer on the Fidelity website also has various tools to help you plan your retirement.
In addition, UPP members can use the Uniper Retirement Options website.
In the ‘explore’ section there is a retirement option illustrator tool which provides an overview of the options available to you.
There is also a video which explains how the retirement option illustrator tool works.
If you are age 50 or over, you can have a free guidance call of up to an hour with a pension specialist from Pension Wise, a service that is provided by the government. Pension Wise will explain your options to take money from your defined contribution pension pots.
To book your appointment, please call Pension Wise on 0800 138 3944 between 8am to 8pm, Monday to Friday. They will send you an email confirmation of your booking. Or you can book an appointment online.
Neither Uniper nor Fidelity can give you financial or investment advice. We recommend you consider seeking independent financial advice before making any decisions. See the help and advice page for more information.
Applying for your pension account
Fidelity will contact you six months before you reach the Normal Minimum Pension Age (currently age 55, rising to 57 in 2028) setting out your options.
You will then need to contact Fidelity to confirm when and how you wish to take your benefits (even if you are taking your benefits at your default retirement age).
You can find a step-by-step guide to the retirement process below…
1. Make sure you understand your options before you apply to take your pension account
Before applying to take your pension account please make sure you understand all the options available to you, particularly when you can retire and the different options you have in relation to your pension account.
If you are unsure as to what the best option is for you, we strongly recommend you take Independent Financial Advice. There is more information on how to do this above and on the help and advice web page.
2. Tell Fidelity about your chosen retirement date
To begin the process, you need to contact the administrator, Fidelity, to let them know when you want to start taking your pension account and request a formal retirement quote.
We recommend that you get in touch with Fidelity to start the retirement process at least 3 months before you want to access your pension account.
You can find Fidelity’s details on the contact details page.
3. Getting your retirement quote
Once you have been in touch, Fidelity will process your request and will send you a retirement quote within five to ten working days.
Your retirement quote will include details of your available options and the forms you need to complete.
4. Confirm your retirement choices
Once you have made your decision, you need to return your forms to Fidelity, confirming how you want to take your pension account and your bank details. This can be done via email and DocuSign.
If you choose an annuity, you will need to choose the new provider yourself, and contact them directly to set up the new arrangement.
You can then return all of the necessary paperwork to Fidelity, who will transfer your benefits to the new provider.
Please remember that once you accept your retirement quote and confirm your choices by returning the form to Fidelity, you cannot change your mind.
5. How your pension account will be paid
Fidelity will process your forms and check they have all the information they need to make any payments to you, or make the transfer to another provider if you have chosen an annuity. If not, they will contact you as soon as possible for further details.
Fidelity will only process your retirement when they receive your forms. Payments may be delayed if your forms are returned late and may not start exactly on your chosen retirement date.
If you choose to take a cash lump sum then the money from your pension account will be paid directly into your bank account. The timescale for receiving this payment may vary and you may want to hold off making any large purchases until the money is in your account.
If you are taking a cash lump sum, you should also be aware of scams. Fraudsters are known to target people in this situation by offering investment opportunities. Please see the scams page for more details.