When should I claim my State Pension?

You can claim from your State Pension age (currently 66). You can defer to increase it by 1% for every 9 weeks you wait (about 5.8% per year). Whether deferring makes sense depends on your health, other income, and tax position.

How do I make my pension last in retirement?

A sustainable withdrawal rate is typically 3-4% of your pot per year. An adviser can model your specific situation, accounting for State Pension, other income, inflation, and your expected lifespan to set the right withdrawal level.

Should I buy an annuity at 60?

Annuity rates are generally better at 60+ than at 55 because they're based on life expectancy. If you have health conditions, you may qualify for an enhanced annuity with even better rates. An adviser can compare annuity quotes with drawdown projections.

What happens to my pension if I die?

If you die before 75, your remaining pension can usually be passed to beneficiaries tax-free. After 75, beneficiaries pay income tax on withdrawals. Annuities typically stop on death unless you have a joint or guaranteed period. A pension adviser can help structure your pension for maximum death benefits.

Do I need to worry about inheritance tax on my pension?

Pensions are usually outside your estate for inheritance tax purposes, making them one of the most tax-efficient assets to pass on. However, from April 2027, pensions may be included in estates for IHT purposes. An adviser can help you plan accordingly.

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🧓 Over 60s Pension Advice

Pension Advice for Over 60s Maximise Your Retirement Income

In your 60s, retirement isn't just on the horizon — it's here. Whether you're already retired or about to stop working, the right advice now can add thousands to your retirement income over the years ahead.

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What Is Pension Advice for Over 60s?

Pension advice for over 60s is specialist financial guidance for people who are in the final stretch before State Pension age and need to make critical decisions about how to convert their savings into sustainable retirement income. At 60, retirement is no longer a distant concept – it is an imminent reality that requires concrete planning, tax-efficient withdrawal strategies, and decisions about drawdown, annuities, and the timing of your State Pension.

Many people in their 60s have already begun accessing their pensions or are about to. The decisions made at this stage – how much to withdraw, in what order, and through which mechanism – will determine your standard of living for the next 25–30 years. With average life expectancy for a 60-year-old now around 85 for men and 87 for women, ensuring your money lasts is a genuine concern. Additionally, proposed changes to pension inheritance tax from April 2027 make estate planning increasingly urgent.

A pension adviser specialising in over 60s planning can help with:

Income sustainability planning – ensuring your pension pot lasts throughout retirement by setting appropriate withdrawal rates and adapting to market conditions.
State Pension timing – deciding whether to claim State Pension at the standard age or defer for a higher amount (approximately 5.8% increase per year of deferral).
Annuity purchase timing – annuity rates improve as you age. An adviser can determine the optimal age to convert some or all of your drawdown pot into guaranteed income.
Tax-efficient income structuring – combining pension, State Pension, ISA, and other income sources to minimise your overall tax bill.
Long-term care planning – considering how potential care costs could deplete your savings and whether pension assets should be structured to account for this.
Estate and inheritance planning – structuring pension withdrawals and death benefit nominations to minimise the impact on your family when you pass away.

Key fact: A 60-year-old man in the UK has an average life expectancy of 85, while a 60-year-old woman can expect to reach 87. However, there is a 25% chance of living to 93 or beyond. This means your pension needs to last potentially 30+ years – significantly longer than many people plan for. Running out of money in your late 80s or 90s is a very real risk without proper planning.

Income Strategies

Full Drawdown vs Partial Annuity vs Blended Approach

At 60+, the optimal strategy often involves combining different income sources. Here is how the main approaches compare.

Feature	Full Drawdown	Partial Annuity + Drawdown	Full Annuity
Income certainty	No guarantee – depends on markets	Partial guarantee + flexible top-up	Fully guaranteed for life
Flexibility	Full flexibility to vary income	Moderate – annuity is fixed, drawdown is flexible	No flexibility once purchased
Longevity protection	Can run out if you live longer than expected	Annuity portion lasts for life	Income for life regardless
Growth potential	Pot can continue to grow	Drawdown portion can grow	No growth – fixed income
Death benefits	Remaining pot passes to family	Drawdown portion passes, annuity stops	Nothing unless joint or guaranteed period

Important: If you are in drawdown and markets fall significantly early in your retirement (sequence of returns risk), your pot may never recover. A 30% market drop in year one of drawdown, combined with ongoing withdrawals, can permanently damage your retirement income. A blended approach with some guaranteed income from an annuity protects against this risk.

Who Is It For?

Who Benefits from Over 60s Pension Advice?

In your 60s, every pension decision has immediate consequences. If any of these apply, professional advice is essential.

💰

About to Retire and Draw Pension

You are within months of retirement and need to set up your pension income. The initial decisions about drawdown, annuity, and tax-free lump sum will shape your finances for decades. Getting it right from the start is critical.

Get advice before your retirement date

⏰

Deciding When to Take State Pension

The State Pension increases by 5.8% for each year you defer. If you have private pension income to bridge the gap, deferral can significantly increase your lifetime income. But it depends on your health, other income, and tax position.

Model deferral vs immediate claiming

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Health Concerns Affecting Planning

Health conditions can change your planning significantly. Enhanced annuities pay more for those with medical conditions, while poor health may mean prioritising income now over longevity planning. Honest assessment is important.

Explore enhanced annuity options

👪

Concerned About Leaving Money to Family

With proposed pension inheritance tax changes from 2027, structuring your pension for death benefits is increasingly complex. Drawing from other assets first and preserving pension wealth for your family may save significant inheritance tax.

Review your estate plan before 2027

🏠

Considering Downsizing Your Home

If you are thinking about releasing equity from your home to supplement your pension, an adviser can model how much additional income this provides, the tax implications, and whether it is better than drawing more from your pension.

Compare downsizing vs pension drawdown

📋

Need to Understand Long-Term Care Costs

The average cost of residential care in the UK is £35,000–£50,000 per year. At the means-tested threshold of £23,250 in assets (or proposed £100,000 cap), your savings could be significantly affected. Planning ahead protects your retirement income.

Factor care costs into your planning

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Costs Explained

How Much Does Over 60s Pension Advice Cost?

At this stage, advice focuses on income strategy, tax planning, and sustainability. Here are the typical fees.

£750–£3,000

Initial Advice

One-off fee for a comprehensive retirement income review covering drawdown/annuity strategy, State Pension timing, tax-efficient withdrawal planning, estate planning, and a year-by-year retirement income projection.

0.5%–1%/year

Ongoing Management

Annual fee for ongoing drawdown management, withdrawal rate monitoring, investment adjustments, annual tax planning, and regular reviews to ensure your income is sustainable throughout retirement.

Worth knowing: Through PensionHelper, our matching service is free with no obligation. At 60+, the decisions you make now will affect your income for the next 25–30 years. The cost of advice is small compared to the potential savings from tax-efficient withdrawals, better annuity rates, and sustainable drawdown planning.

Simple Process

How It Works

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Your adviser reviews your situation and recommends the best course of action.

Real Reviews

What Our Customers Say

Margaret S.

Dorset • Over 60s Pension Advice

★★★★★

“Income plan gave me confidence”

At 62, I was terrified of running out of money. The adviser created a year-by-year plan combining my pension drawdown, State Pension from 67, and ISA withdrawals. Knowing exactly how much I can spend each year has transformed my retirement.

Richard C.

Norfolk • Over 60s Pension Advice

★★★★★

“State Pension deferral was the right call”

The adviser showed that deferring my State Pension by 3 years while drawing from my SIPP would give me £2,800 more per year from my State Pension for life. With my health being good, the breakeven is age 80 and I plan to live well beyond that.

Barbara K.

Sussex • Over 60s Pension Advice

★★★★★

“Enhanced annuity changed everything”

With high blood pressure and controlled diabetes, I qualified for an enhanced annuity paying £8,400 per year instead of the £5,900 standard rate. That extra £2,500 every year makes a huge difference to my quality of life in retirement.

Tony M.

York • Over 60s Pension Advice

★★★★★

“Estate plan saved the family £60,000”

The adviser restructured our withdrawals to draw from ISAs and savings first, preserving our pensions. Given the proposed 2027 IHT changes, this strategy could save our children over £60,000 in inheritance tax. Forward thinking at its best.

Pauline R.

Cheshire • Over 60s Pension Advice

★★★★★

“Care costs factored in properly”

My mother needed care that cost £42,000 per year. The adviser helped me plan for the possibility of needing care myself by ring-fencing a portion of my savings and structuring my income to protect against that risk. Sensible, practical planning.

David J.

Bath • Over 60s Pension Advice

★★★★★

“Blended approach was perfect”

Rather than choosing all-drawdown or all-annuity, the adviser recommended using £150,000 for a guaranteed annuity covering essential costs and keeping £200,000 in drawdown for flexible spending. The certainty of the annuity combined with drawdown flexibility is ideal.

Learn More

Related Guides

Explore our guides for more information on pension planning for the over 60s and retirement income.

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Pension access and drawdown guidance

Over 50s Pension Advice

Planning ahead for retirement

Couples Pension Advice

Joint retirement planning

Retirement Planning

Complete retirement planning guide

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Our complete collection of pension resources

Got Questions?

Over 60s Pension Advice: Frequently Asked Questions

For a comfortable retirement, the PLSA suggests a single person needs £31,300 per year. With the full State Pension at around £11,500 per year (from age 66/67), you need approximately £19,800 from private pensions. At a 4% withdrawal rate, this requires a pot of about £495,000. However, if you retire at 60, you also need to bridge 6–7 years before State Pension starts.

Not necessarily all at once. You can take it in phases through drawdown, which gives you more flexibility and keeps more of your pot invested. Taking the full 25% at 60 and putting it in a bank account earning minimal interest may not be the best strategy. Consider what you actually need the cash for – if you do not have an immediate use, phased withdrawal is often better.

Deferring increases your State Pension by approximately 5.8% for each year of deferral. The full new State Pension deferred by 2 years increases from £221.20 to approximately £246.80 per week. The breakeven point is roughly 17–18 years. If you are in good health and have other income, deferral can be worthwhile. However, the income is taxable, which reduces the net benefit.

The optimal approach depends on your circumstances, but many advisers recommend a combination: use your 25% tax-free lump sum to supplement income in the early years, draw from your pension in a tax-efficient way staying within the basic rate band, and coordinate with State Pension when it starts. This approach minimises tax and maximises the life of your pension.

At a 4% withdrawal rate with moderate investment growth, a pension pot should last 30+ years. However, poor early returns, higher withdrawal rates, or unexpected expenses can shorten this significantly. A £300,000 pot at 5% withdrawal (£15,000/year) with 4% growth would last approximately 28 years. Professional modelling with stress testing is essential.

Annuity rates improve with age because the insurer expects to pay for fewer years. At 60, rates are lower than at 65 or 70. Many people benefit from drawdown in their early 60s, then purchasing an annuity later when rates are higher and the certainty of guaranteed income becomes more valuable. A blended approach starting with partial annuity purchase can also work well.

Pension income is added to your other income (including State Pension, employment, and investment income) and taxed at your marginal rate. The personal allowance is £12,570, then 20% basic rate up to £50,270, 40% higher rate up to £125,140, and 45% above that. Careful planning of which income sources to draw from each year can keep you in lower tax bands.

Your pension income counts as income for care fee means testing. Pension pots in drawdown may also be considered as capital depending on local authority assessment rules. Annuity income is counted but the annuity itself is not typically counted as capital. Planning how to structure your pension before needing care can make a significant difference to what you pay.

Yes, as long as you have relevant UK earnings. You can contribute up to 100% of your earnings or £60,000 (whichever is lower). Even without earnings, you can contribute up to £3,600 gross. However, if you have already accessed your pension flexibly, the Money Purchase Annual Allowance of £10,000 applies to future defined contribution pension contributions.

Sequence of returns risk is the danger that poor investment returns early in retirement permanently damage your drawdown pot. Even if average returns over 30 years are good, a big loss in years 1–3 combined with ongoing withdrawals can mean your pot never recovers. This risk is highest in the first 5 years of drawdown and is a key reason to consider some guaranteed income through an annuity.

From April 2027, the government proposes to include unused pension pots in your estate for Inheritance Tax purposes. Currently, pensions pass outside the estate and are often tax-free if you die before 75. The change would mean pensions could attract 40% IHT for estates above the threshold. This may change withdrawal strategies – it may be better to draw pension first and preserve ISA/cash assets.

Almost certainly not. Taking your entire pension as cash means 75% is taxed as income in one year, which could push you into the 40% or 45% tax bracket. On a £200,000 pot, you would receive £50,000 tax-free but could pay over £40,000 in tax on the rest. Phased withdrawals over several years would significantly reduce the total tax paid.

A joint life annuity pays income to both you and your partner for as long as either is alive. When the first partner dies, the survivor continues to receive a reduced income (typically 50%–66%). Joint annuities pay less initially than single life annuities but provide security for the surviving partner. They are particularly valuable for couples where one partner has limited pension savings.

The government’s free Pension Tracing Service (gov.uk/find-pension-contact-details) can help locate lost pensions from previous employers. You need the name of the employer or pension provider. Many people in their 60s discover forgotten pensions from early career jobs – even small pots can be valuable, especially if they have guaranteed annuity rates or other protected benefits.

Through PensionHelper, we match you with FCA-regulated advisers who specialise in retirement income planning for the over 60s. They help with drawdown management, annuity comparison, State Pension timing, and tax-efficient withdrawal strategies. Our form takes 60 seconds, and our matching service is free with no obligation.

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