Cash into Pension
Discussion
Hi,
Hoping to hear if my idea has merit…
I’m 52 with a Group Personal Pension Scheme (Aegon) through my employer. Assuming my pension pot is accessible from 55, I’m thinking of adding cash savings to my pension each year up to the £40K limit for the next 3 years. As a higher rate tax payer I’m assuming that I can claim the 20% + 20% Tax back to also go into my pension pot. Then hypothetically retire at 55, accessing my pension pot which could include a 25% Tax free lump sum and I’d keep yearly withdrawals under the 40% Tax bracket.
To me this seems a good way to regain some of the income Tax I’ve paid. Is my plan flawed?
A
Hoping to hear if my idea has merit…
I’m 52 with a Group Personal Pension Scheme (Aegon) through my employer. Assuming my pension pot is accessible from 55, I’m thinking of adding cash savings to my pension each year up to the £40K limit for the next 3 years. As a higher rate tax payer I’m assuming that I can claim the 20% + 20% Tax back to also go into my pension pot. Then hypothetically retire at 55, accessing my pension pot which could include a 25% Tax free lump sum and I’d keep yearly withdrawals under the 40% Tax bracket.
To me this seems a good way to regain some of the income Tax I’ve paid. Is my plan flawed?
A
PurpleMoonlight said:
Do you really mean retire at 55?
How long would your pension pot last withdrawing £50,000 odd pa from it?
Not long at that amount!! How long would your pension pot last withdrawing £50,000 odd pa from it?
However I'm thinking of a quiet life from 55. Maybe £25K per annum for 12 years, then reducing. Made up of £11K from pension (max. Tax free allowance) and the rest from savings & assets.
A
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