You should think carefully about taking money from your pension pot to pay off debts. Money you take from your pot now could leave you with less to live on in the future.

Arrangements to pay your debts

If you have an arrangement to pay your debts, your creditors may be able to take money from your pension income or lump sums.

This includes money or income from:

  • an annuity
  • a flexi-access drawdown fund
  • any cash taken in chunks
  • any cash from taking your whole pot in one go

Find out the status of any debt arrangement you have before choosing a pension option.

Read more about debt payment arrangements on GOV.UK.


Most pensions pots aren’t included as assets in your bankruptcy. This means they can’t be claimed by the person appointed to manage your bankruptcy (known as your ‘trustee’) if you don’t take money out of your pot.

If you do take income or lump sums from your pot, your trustee may ask you to make regular payments towards your debts from that money. They can also claim an entire lump sum you take while you’re bankrupt.

Read more about bankruptcy on GOV.UK.

Getting help with debt

Citizens Advice has information to help with debt problems and to help you manage your money.

Find organisations that offer free debt advice on the Money Advice Service website.