Is Selling Your Pension to Bankroll Your Start-up a Good Idea?

Credit: Ervins Strauhmanis

Retirement dreams are usually filled with soft slippers, bags of free time and absolutely no chance of setting foot in the office ever again – unless you are an entrepreneur.

However, you earn your living, planning to launch a new start-up enterprise can be daunting. Whether you are struggling to pull together the funds to bankroll your idea or you just aren’t sure how you will keep it going, financial security is always going to be an issue.

Wouldn’t it be great if you could instantly gain access to thousands of pounds? Well now you can, by releasing your pension.  

Releasing your pension is a completely legitimate way to gain access to the money that you’ve saved over the years. It’s not an option for everybody, as you’ll take the risk that you may overspend and be left without any additional pension funds, so the decision should never be made without careful consideration.

Debt-free opportunities

For an entrepreneur desperately trying to fund their start-up, a loan may seem like the best option. But nobody wants to suddenly take on the burden of debt after years of saving and work. Could the solution be to unlock your pension?

Unlocking your pension allows you access to the money you have saved, without the nasty consequences that a loan can bring. You can freely invest your money in your start-up business, safe in the knowledge that you won’t suffer any of the consequences of a loan, like high interest rates.

Increase your pension pot

Instead of looking at it as taking away funds from your pension, think of releasing your pension as temporarily growing your pot by investing in other ventures. If successful, the investment that you put into your business has the potential to be doubled, tripled, or even quadrupled once you are up and running, creating one hugely lucrative pension to retire with.

Don’t overspend

As an entrepreneur, you’ll happily sacrifice everything you have to make your business a success. While we admire that passion for business, you must be careful not to spend your entire retirement fund on one venture that unfortunately may not work out as you had hoped.

Ensure that you properly budget how much of your pension you can afford to risk losing, just in case something bad happens and you do need the rest of the money to fall back on.