When you reach age 55 you can take your pension if you want to. But be careful, the earlier you take it the longer you will need to make it last.

Age 55 is the current minimum age the Government allow people to access a pension. This will increase to age 57 from April 2028.

When you are ready to take your pension, let us know the date you wish to take it. We will send you a summary of your choices and the forms you need to complete.

Paying you a pension for life

We will pay this to you on the last working day of every month, for your lifetime. Your pension is taxed as income through PAYE. We deal with this tax for you, but we rely on HMRC to tell us your correct tax code. This could mean your pension is taxed incorrectly for the first few months.

Early retirement

If you take your pension before your Normal Pension Age (NPA) we reduce it as we are likely to pay it for longer. Your NPA will be 60, 62, 65 or 68. If you are not sure what your NPA is, just ask and we can let you know. The earlier you take your pension, the less it will be.

If you're thinking of taking your pension early, speak to us first. We can send you early retirement figures so you can see what your pension is likely to be.

Late retirement

If you are no longer an active member and you take your pension after your NPA we will increase, it as we might pay it for a shorter period.

If you are still an active member, you continue to earn pension as you usually do, so we don't increase it for later payment.

Tax-free cash option

You can give up part of your pension for a tax-free cash sum. If you go for this, we will reduce your pension. Think carefully whether this is the right choice for you.

Optional pension for a spouse or civil partner

In most circumstances, your pension comes with a 50% spouse or civil partner's pension when you die.

If your pension doesn't come with a spouse or civil partner's, you can give up part of your pension to provide this. You need to make this choice at retirement, you cannot change your mind later.

Taking your pension and continuing to work

You can take your pension and keep working. Your pension is added to your overall taxable income for the tax year, so check which tax band this will put you in.

Ill health retirement

If your health is impacting your ability to work, you can apply for an ill-health pension. How much your pension will be depends on what your employer has chosen to provide. 

It can take time to approve ill-health pensions, often up to 6 months. Some cases are straightforward, but some are complex, and we might need independent medical advice. We will keep you informed as much as we can throughout the process. 

Transferring your pension

Most people are happy to stick with the choices we offer. Taking your pension from us can often be the best option, but transferring your pension can give you more freedom and flexibility over how you take your money.

How does a transfer work?

A pension transfer means giving up your pension in return for a sum of money, which is called a ‘transfer value’. Your transfer value could be a large amount of money which you could transfer to another registered pension scheme to then take as cash or invest. While it is invested it could go up in value, but there is a risk it could go down in value too.

Once you transfer your pension, there are lots of different ways you can use your money.

Your pension comes with guarantees. Transferring this away from us is a difficult decision, and usually requires you to take professional advice.

3 trees and a shed showing your 3 pension options at retirement

Choosing which option is best for you can be a challenge.

Read more about your retirement options

People receiving pensions advice

A financial adviser can recommend the best option for you and your circumstances. 

Check how we can help you find financial advice

Source URL: https://www.churchofengland.org/resources/pensions/dbs-my-retirement-options