Follow your dreams with April’s pension reforms

Currencies Direct February 27th 2015 - 3 minute read

If you’re over 55, you’ll soon have more freedom over when you spend your pension. We look at some of the ways people plan to make spring 2015’s changes work for them

 

You’ll have greater freedom of access to your savings from April this year, provided you’re over 55 and have a defined contribution pension. This is thanks to the scrapping of legislation that forces savers to spend 75% of their savings on a fixed annual income annuity, whether they want to or not. From April, you’ll be able to take a number of smaller lump sums, and 25% of each of these will be tax-free.
 
With careful planning and sound financial advice, you could make your retirement dreams a reality. We asked four Brits what they plan to do now they have greater access to their savings.
 
 
Julia Blake, 62 from Tunbridge Wells: We’ve holidayed in the South of France for many years and have always dreamed of owning our own property there. Cannes, for us, is the obvious choice because of its vibrant social scene, excellent transport links with the rest of Provence and proximity to Monaco and Italy. Buying an apartment there will also mean that each year we have the option to visit during the Film Festival. We’ve already received professional advice on investing in overseas property, and are now beginning the flat-hunting process. The plan is to put down a deposit once April’s pension changes come in.
 
Jane Rogers, 60 from Manchester: My daughter Ciara has decided to take a gap year, having finished her A-levels and deferring her place at university. She plans to stay in Assisi in the Italian region of Umbria, and earn money working part time for a family she met through an au pairing website. When not taking care of the children she’ll be studying in nearby Perugia to improve her Italian, and seeing as much of Italy as possible. My husband and I plan to help her out with the college fees with some money drawn from our pension. It’s great to know that some of our savings can now be used to improve our daughter’s language skills and give more her more experience of the world.
 
Colin Parsell, 66 from Dagenham: I retired last year and have decided to see out my winter years in the sunnier climes of Thailand, after discussing the implications of emigrating with a financial planning expert. Thanks to the change in legislation, after April I’ll be finalising buying an apartment over there and putting the wheels in motion to have my things shipped over. Being able to withdraw from my savings more freely will really help with getting settled too.
 
Alan Chapman, 66 from Biggin Hill: My daughter Debbie, who’s 27, last year decided that she wanted to follow her dream of going backpacking before her career as a physiotherapist really got going. My wife and I also love travelling and would like to meet her in Goa for a holiday in the spring. Having travelled around for many months she’s now a little short on funds so we’ll be transferring some money from our pension over so that she and her boyfriend can afford the flights and accommodation to come and stay with us.
 
If you’re thinking of spending your pension overseas, it’s important to consider the effect exchange rates can have on lump sums as they’re transferred from one currency to another. Whether you plan to help out a loved one, like Jane and Alan, invest in a second home, like Julia, or escape to the sunshine long-term, like Colin; foreign exchange experts like Currencies Direct can carefully monitor the market and manage transfers so that the most amount of money possible lands in your overseas account safely and smoothly.
 
At Currencies Direct we are constantly beating the banks on rates, with savings of up to 5%. We offer a suite of products that can be tailored to suit the needs of each individual customer. Asking us for help when making overseas transfers from your pension can ensure the money you’ve worked so hard for over the years is not hit by hidden rates.
 
Let’s talk! The team at Currencies Direct are ready to take your questions and discuss your needs. Call us on +44 (0) 20 7847 9400 or find out more by exploring our website Register with us and beat the banks with a saving of up to 5% on overseas transfers.* No hidden fees, no jargon – just a friendly and helpful service to get you the best possible exchange rate.
 
*Based on exchange rate comparison as of 18/02/2015
 

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