It depends on you how delicious will be the delicatessen food from your pension pot. Further more, you are able to govern how often and how much you will take portions from this golden pot.
Those who have defined contribution schemes are building up their pension pots over ears. Usually, they are arranging the payments of their pensions, being close to the retirement age.
The basic economic rule is that the older you are when you decide to take your pension the higher the payments will be. The reason for this is that in such circumstances your life expectancy is shorter. Although this fact, some pension schemes offer an option to take larger pension under condition that you will keep your pension fund invested.
How delicious or full of nutrition your pension pot will be depends on you simply, because you manage the processes and time, related to these main outcomes:
When (at what age) you will retire?
What will be your pension amount?
Whether you selected a good deal for your future regular payments?
The aforementioned age rule already suggested in what direction your pension plan may be oriented. It is advisable to discuss the topic with your pension provider or the insurance company dealing with your pension as well.
Commonly, the scheme for receiving of your pension looks like this:
- You are taking part of it as a lump sum and
- The rest of your pension you are receiving as regular payments as agreed -monthly, quarterly, half-yearly or annually.
The scheme regardless of what it is depends on the agreement you have with your pension provider.
Referring to the third outcome, related to the good deal it is worth to mention that this seems to be the most time consuming and difficult element. These two guidelines may help when you negotiate with your pension provider or the insurance company:
1. You can choose to receive regular payments from your pension pot through buying an annuity or
2. You can choose to take payments and at the same time, to keep your pension fund invested.