A pension is a tax-efficient savings vehicle - one of the best around - but once you take your money out of your pension you start incurring tax on your withdrawals. If you don’t need to access your pension, then you’re better to leave it invested and take it as monthly income (rather than taking it out as a lump sum).  If you do decide to take your pension as a lump sum:   The first 25% is tax free but you’ll pay income tax on the rest at your highest rate You could be liable for other taxes if you reinvest your money elsewhere for example into property You could become liable for Inheritance tax at 40%