Personal Pension Release is the term given to the process of unlocking or withdrawing funds perviously locked in a Personal Pension Scheme.
The process is open to those over the age of 50 who have either Personal Pension Plans, Stakeholder Pensions or even an â€œold styleâ€ Retirement Annuity Contracts.
Previously it was not possible to release the monies until you were 60, but recent legislation in April 2006 has made it possible to enjoy previously locked up pension schemes at the age of 50.
You can take a maximum cash lump sum, which is tax free, of up to 25% of your pension fund, the balance has to be used to either provide an immediate income or it can be deferred and taken at a later date.
Deferring taking the income was not an option before April 2006 and with a lot of existing pension contracts it is still not allowed. However; there is a way you can achieve this even if your current plan doesnâ€™t allow it.
A benefit of deferring taking the income is that this portion of your pension fund remains invested and accruing interest, which could result in a bigger amount when you decide to take it, although it is conceivable that the fund in which it is invested could also perform poorly and you could end up with less money. Because of the uncertainty there is not always a simple answer and not all people should consider releasing funds from their pension early.
Whether you decide to take income from your pension now or defer taking it until some point in the future, you will also have a choice about how your income is paid. All these choices and options available can seem complicated and confusing, and it is important to make sure you make the right decisions that are going to suit you best.
The Personal Pension Release Website is an information portal on the subject of pension unlocking or pension release and provides an unbiased viewpoint into the process of unlocking funds from personal or private pension schemes with an emphasis on illustrating both the pitfalls and the potential rewards on offer and as a result of careful and sensible financial planning. As it must be remembered that taking funds early may well diminish the amount available at retirement age.