Pensions have been transformed by the arrival of freedom reforms on 6 April 2015 which now give much greater flexibility over what you can do with your pension pot. The new freedoms mean you can enjoy far greater choice on how you spend and generate an income from your pensions, but with further changes on the horizon these are some of the key points you need to know. With these key points that you need to know you may find you need to have some independent financial advice on your pension or a number of pensions you have to see what you should do and what changes could effect you, we at Hutt Professional can offer you the independent financial advice you need.

State Pension
The new State Pension will be a regular payment from the Government that you can claim if you reach State Pension age on or after 6 April 2016. If you reach State Pension age on or after that date, you’ll get the new State Pension under the new rules.
The new State Pension is designed to be simpler. But there are some complicated changeover arrangements which you need to know about if you’ve already made contributions under the current system.

You’ll be able to get the new State Pension if you’re eligible and:

ν A man born on or after 6 April 1951
ν A woman born on or after 6 April 1953
If you reach State Pension age before
6 April 2016, you’ll get the State Pension under the current scheme instead.
You can still get a State Pension if you have other income such as a personal pension or a workplace pension.

How much you can receive
The full new State Pension will be starting at £155.65 per week. Your National Insurance record is used to calculate your new State Pension.
You’ll usually need ten qualifying years to get any new State Pension. The amount you receive can be higher or lower depending on your National Insurance record. It will only be higher if you have over a certain amount of Additional State Pension. You may have to pay tax on your State Pension.

Working after State Pension age
You don’t have to stop working when you reach State Pension age, but you’ll no longer have to pay National Insurance. You can also request flexible working arrangements.

Defer your new State Pension
You don’t have to claim the new State Pension as soon as you reach State Pension age. Deferring the new State Pension means that you may get extra State Pension when you do claim it. The extra amount is paid with your State Pension (for example, every four weeks) and may be taxable. After you claim, the extra amount you get because you deferred will usually increase each year.

What this means
for your pension
Your State Pension will be lower if you’ve ever been contracted out of the Additional State Pension.

If you would like to seek independent financial advice on your pension or on a number of pensions you have, we at Hutt Professional are able to offer you that independent financial advice you may need. If you are located in Leamington Spa or surrounding areas please do not hesitate to contact us as we will appoint you with the correct financial adviser for yourself.


Source:  12/04/2016