Approaching retirement hub
The 5–10 years before you stop work are when most decisions get locked in: State Pension forecast, workplace pension consolidation, drawdown versus annuity, tax-free lump sum, and IHT planning. This hub points you at the guides and tools to make those decisions on solid ground.
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The ordered steps
1. Check your State Pension forecast
Log into gov.uk and check your forecast. You need 35 qualifying years of National Insurance for the full new State Pension. The current cut-off to top up gaps as far back as 2006 was 5 April 2025 — after that, normal six-year rules apply.
2. Find and consolidate old pensions (where it makes sense)
Most people change jobs many times. The Pension Tracing Service on gov.uk is free and finds workplace and personal pensions linked to past employers. Once you know what you have, you can decide whether to consolidate — keeping any that carry valuable guarantees.
3. Decide between drawdown and annuity (or both)
Drawdown keeps your pension invested and lets you take what you want, when you want — flexible but exposed to market falls and longevity risk. An annuity converts a pension lump sum into a guaranteed income for life. Many people use a mix.
4. Know the lump sum limits
Since 6 April 2024 the Lump Sum Allowance caps total tax-free pension lump sums at £268,275 across your lifetime. The Lump Sum and Death Benefit Allowance is £1,073,100. Taking your 25% tax-free cash uses up part of this allowance.
5. Plan for IHT changes from April 2027
From 6 April 2027, most unused defined-contribution pension funds will fall within Inheritance Tax for the first time. This is a structural change — review who is named on death-benefit nominations and whether expression of wishes is up to date.