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Can I cash in my pension to to buy a house?

If you are aged 55+ and have a personal or company pension you are not currently paying into or receiving, you can cash in 100% of your pension as a lump sum to buy a house – up to 25% Tax Free

Can I cash in my pension to to buy a house?
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Case Study: Using your pension fund to buy a house

Helen who needed money urgently and was considering Pension Release or Pension Unlocking from her personal pension plan.

She explained that she and her husband needed to raise as much capital as possible for a deposit on a house. They had a £10,000 payout from a bank charges claim but needed to top this up to give them a sufficient amount to put down as a deposit. Pension Release, otherwise known as Pension Unlocking, seemed to offer the solution for them.

For the couple it was extremely important to get back on the mortgage ladder and own their own home after a period of living in rented accommodation. Helen explained that the couple had invested all previous savings in a business which unfortunately failed and due to other circumstances, were not in a position to borrow money for the deposit.

Taking cash from the pension now in the form of Pension Unlocking or Pension Release, although maybe not the ideal solution, was for them the only real alternative to enable them to meet their objective.

Helen and her husband fully understood that by taking benefits from Helen’s pension early the pension income in retirement would almost certainly be reduced. However, the position they found themselves in meant their retirement fund, for the time being, had become very much a secondary concern.

Once they had sorted out the mortgage and purchased a house, they could then focus their attention to the matter of planning for their retirement. At the time, Helen was aged 51 (the rules at the time allowed access from age 50, they have subsequently changed to age 55) and her husband was only 40, so they still had enough time left between them to accumulate an acceptable retirement fund.

In this instance Pension Unlocking or Pension Release was appropriate for their circumstances. Obviously, had the circumstances been different – had they been older and had less time to rebuild their retirement funds, or had the amount needed led to too large reduction in pension income for example – then this solution would not have been for them.

Need advice on how to access your pension to buy a house?

Grove Pension Solutions Ltd is regulated by the Financial Conduct Authority.

If your pension pot is worth £30,000 or more you need to take specialist advice from a FCA regulated firm, such as ourselves, before you transfer or cash in your pension to buy a house.

We specialise solely in Defined Benefit Pension Transfer and Pension Release.

We were established in 2007 so have many years of experience successfully helping 1000’s of individuals. Some of them we advised to transfer their pensions and some of them we advised to leave their pensions where they are and not transfer them.

So why not Get Started Today and receive your free Information Pack.

Pension Transfer Consultation

Get Started Today

Free Pension Transfer Guide & Consultation
If you would like to find out if transferring your pension or taking a cash lump sum is suitable for you, we can provide a free initial Pension Transfer Consultation known as abridged advice.

Simply complete your details below, and we will send you our Pension Transfer Consultation Pack and Enquiry Form.

As part of the consultation we will look at:

  • What existing pension plans you have in place.
  • What your plans are for retirement.
  • Your needs for flexibility and control.
  • The likely cost of more in-depth advice.

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Defined Benefit Pension Transfer Warning

Transferring away from a defined benefit pension scheme means you will lose valuable guarantees.

Taking benefits early will almost certainly reduce your pension income in retirement and is only suitable for a limited number of people and circumstances. This should not be seen as an easy option for raising cash.

If you release all your money from your pension early you will not have anything left to provide you with income in retirement.

When releasing cash from your pension, usually up to 25% is tax free, the balance is taxed at your marginal rate at the time and could change in the future.

Watch the FCA video explaining the expectations of financial advisers when advising you on defined benefit pension transfers.

Grove Pension Solutions Ltd is authorised and regulated by the Financial Conduct Authority (Reference number 465051).

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