How can I withdraw from a Monzo Pension?

When can you withdraw from a Monzo Pension?

As your Monzo Pension is a personal pension, the same rules apply for when you can access your pension. This is currently 55 years old, rising to 57 from 2028. Accessing your pension is known as ‘withdrawing’.

When you’re eligible to withdraw from your Monzo Pension, you’ll have two options:

1️⃣ Take the full pension in cash

We offer the ability to take your full pension in cash (we don’t offer the ability to take it in chunks). To choose this option, you can’t have taken money from your pension in any other way. You can take 25% of it tax-free, but you’ll be taxed on the rest. The taxes you pay depend on your circumstances and rules could change in the future. In some cases, you may be charged at an emergency tax rate and you’ll need to contact HMRC directly to sort this out.

This option is known as an ‘uncrystallised fund pension lump sum’ or UFPLS.

2️⃣ Buy an annuity

You can use your pension to buy a guaranteed income. This is known as an annuity. Based on the value of the pension, an insurer will work out how much income you’ll receive.

An annuity can provide an income for life, or for a set period of time. It’s important to know that once you’ve chosen an annuity you won’t be able to change your mind.

Speak to a financial adviser if you’re unsure

If you’re unsure of which option works best for you, we suggest speaking to a financial advisor, who can help you make the right decision for your situation. You can find regulated and impartial advisers through the MoneyHelper website.

Or, if you’re over 50 you can get free and impartial guidance through Pension Wise.