You don’t have to retire to start taking benefits. You can normally start to take advantage of your pension benefits from age 50 (age 55 from 6 April 2010).
 You do not have to use your entire fund to provide benefits before age 75 as you can:
- buy an annuity from any authorised provider
- leave your pension fund invested and draw income from it. This is currently referred to as income drawdown but under the new legislation you may hear it referred to as ‘Unsecured Pension’ (USP)
- take a combination of the above and also purchase annuities or take income drawdown in phases.
When you use some of your fund to provide benefits before your 75th birthday, 25% of that fund may normally be taken as a tax free pension commencement lump sum.
On reaching age 75, and in the absence of any other instruction, any remaining pension fund will automatically become a form of income drawdown known as ‘Alternatively Secured Pension’ (ASP) and any remaining entitlement to tax free pension commencement lump sum will be lost.
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