SERPS from the State comes with your basic State Pension, but contracted-out money held by a provider may be a pot you can take from 55 (57 from 2028).

"SERPS" gets used for two different things, and the answer to whether you can cash in a SERPS pension depends on which one you mean. For a defined contribution pot, free guidance comes from Pension Wise, which MoneyHelper describes as impartial and backed by government. Where your own circumstances matter, an FCA-authorised adviser can take you through them: use the enquiry form on this page; it costs nothing.

Two things people mean by a SERPS pension

GOV.UK explains that before 2016 the Additional State Pension "was also known as State Second Pension or ‘SERPs’". Its own table is more exact: the State Earnings-Related Pension Scheme (SERPS) covered 1978 to 2002, and the State Second Pension replaced it from 2002 (GOV.UK, Additional State Pension: eligibility). In everyday use, though, people say "my SERPS" about two quite different pieces of money:

  • Extra State Pension. The entitlement you built up in the State scheme and which is paid by the government, with your basic State Pension.
  • A contracted-out pension. If you were "contracted out", part of your National Insurance went to a workplace or private pension in place of that extra State Pension. That money sits with an insurer, scheme or provider, which is why people search for it as something they can "cash in".

Both are real, and you may have one, the other or a mixture. They follow different rules. The sections below take them in turn, then cover how to tell which you hold.

The extra State Pension: paid with your State Pension

GOV.UK says "The Additional State Pension is paid with your basic State Pension", into your bank account, and "There is no fixed amount" (GOV.UK, Additional State Pension: what you’ll get). It was open to a man born before 6 April 1951 or a woman born before 6 April 1953; anyone who reached State Pension age on or after 6 April 2016 gets the new State Pension instead.

That has two consequences for the question you typed:

  • There is no "age 55" for it. It arrives when you claim your State Pension, and you "do not have to do anything to claim" it separately. The age comes from your State Pension age, not from the pension tax rules.
  • It comes with your State Pension payments. There is, though, a lump sum route linked to putting off your claim: someone who reached State Pension age before 6 April 2016 and defers for at least 12 months can choose a one-off payment instead of higher weekly payments (GOV.UK, Defer your State Pension). That is a deferral choice, covered in taking the State Pension as a lump sum.

Contracted-out money held by a provider

GOV.UK explains that under the rules before 2016, "you or your workplace or private pension scheme could choose to ‘contract out’ of the Additional State Pension", and that "All contracting out stopped on 5 April 2016" (GOV.UK, Contracted out of the Additional State Pension). It adds that "Most people who were employed before April 2016 were contracted out at some point", so this is far from rare.

What happened to the money depends on the kind of scheme that was used.

If the rebate went into a personal or money purchase pension

MoneyHelper says contracting out was possible through some types of personal pension "until 2012", and that for some people the contracted-out amount "would have been paid into a defined contribution (DC) pension" (MoneyHelper, What is COPE and how does it affect my State Pension?, last updated 14 March 2025, so check the current version).

These pots used to be called protected rights. HMRC's manual explains that this fund "was ring-fenced and could only be paid out in certain prescribed ways", and that "Protected rights were abolished from 6 April 2012 by Section 106 of the Pensions Act 2008" (HMRC, IHTM17056). For inheritance tax on deaths from that date, the manual treats such funds as payable "in the same way as any other pension funds". The Act itself says that from the abolition date "pension schemes are not required to make special provision in relation to the protected rights of members" (Pensions Act 2008, section 106). Your provider can say how your old plan is now held and whether it has any features of its own.

The age comes from tax law. The Finance Act 2004 sets the normal minimum pension age at 55 now and 57 from 6 April 2028, with a separate rule for uniformed services pension schemes (legislation.gov.uk, Finance Act 2004, section 279). The FCA notes exceptions "in certain cases, such as poor health", and MoneyHelper allows for schemes that let members take a pension before 55. These are covered in taking a pension at 55, cashing in because of ill health and protected pension ages.

If it was a final salary scheme

A contracted-out final salary scheme is a different animal. MoneyHelper says such a scheme "would have to provide a minimum benefit known as 'Guaranteed Minimum Pension' (GMP), in place of the additional pension you were giving up". That is part of an income paid by the scheme rather than a pot, so the scheme’s own rules decide whether any of it can be taken as cash: see final salary pensions and, for a one-off payment, trivial commutation.

Whether any of this is worth a conversation with an FCA-authorised adviser depends on what you find. Once the type is clear, the short form on this page is where a call-back from one starts.

Working out which one you have

Start with what you can check yourself. GOV.UK says "If you have any payslips with the category letters D, E, L, N or O, then you were contracted out", and that you can also ask your employers or your pension providers. The same MoneyHelper article adds that HMRC "can tell you when you were contracted out" if you contact its National Insurance helpline.

Then follow the money:

  1. List the employers you worked for before 2016, and any personal pension you set up yourself.
  2. Ask each provider or scheme whether you were contracted out and what is held, including "a forecast of your contracted out pension benefits".
  3. Use the Pension Tracing Service if you have lost touch. It gives you contact details for a scheme, not confirmation that a pension exists or a valuation, and you need the name of an employer or provider to start (GOV.UK, Find pension contact details). The step-by-step is in finding a lost pension, and tracing an older State-related entitlement has its own guide, finding a lost SERPS pension.
  4. Read the statement. A personal pension provider sends yearly statements showing what your fund is worth.

The answer decides what you can do. A defined contribution pot can be taken within the rules (the next section); a final salary income follows the scheme’s rules, and the State entitlement is paid as described above. Taking cash from a pot is covered on cashing in a pension.

If it is a pot: what taking it involves, and the investment risk

For a defined contribution pot, GOV.UK says most personal pensions set a starting age that is not normally before 55, and lists ways to take the rest: cash (all or some), a guaranteed income for life, or flexible drawdown. Providers may not offer every option, so ask yours; a pot can be moved to a different provider if none suits (GOV.UK, Personal pensions: how you can take your pension).

Each route is explained in its own guide: all the options at retirement, cashing in the whole pot, drawdown, smaller cash withdrawals and annuities. Up to a quarter of what is built up can usually come out tax-free; how that works is in the tax-free lump sum guide. On the rest, the provider takes off any tax you owe before paying you.

The investment risk

A contracted-out pot is invested, and that matters more for old money than people expect. GOV.UK explains that a personal pension is invested by the provider, for example in shares, and that what you get depends on "how the fund’s investments have performed - they can go up or down". MoneyHelper says the amount from a contracted-out DC pot "will depend on factors such as investment performance, fees you are charged, and the choices you make when you decide to access the pot".

Put plainly, the value of the investments can fall as well as rise, and you may get back less than was paid in. Three things follow for an old pot:

  • Look at what it is invested in. A plan left alone for years may sit in a fund that no longer suits your plans or age.
  • Look at the charges. They come out of the pot every year; pension charges explains the common types.
  • Cashing in is not the end of the risk. Tax is deducted from cash above the tax-free part, and money left invested stays exposed to the same ups and downs; the risks of drawdown covers what happens if the money stays invested.

If a plan is small, the small pot rules may apply, and what happens to a pot when you die is on pension death benefits.

Offers to unlock it early

An old contracted-out plan can look like forgotten money, which is what early-release scams target. The FCA says an offer to get cash out of your pension before 55 is "almost certainly a scam", and that someone who takes one up may find their "pension funds will be transferred into a scheme set up by the scam, which will often be based abroad". See its pension scams page, and early withdrawal penalties for the tax side.

Questions about cashing in a SERPS pension

Can I take my SERPS pension at 55?

The extra State Pension is paid with your State Pension, from State Pension age, so 55 does not apply to it. A contracted-out defined contribution pot can usually be taken from the normal minimum pension age, 55 now and 57 from 6 April 2028. A contracted-out final salary income follows the scheme’s own rules.

Can I take 25% of my SERPS pension as a tax-free lump sum?

GOV.UK puts the usual tax-free share at up to 25% of what a pension has built up, so this can apply to a contracted-out pot. The extra State Pension is different: it is paid with your basic State Pension, as described above.

Do I have to claim SERPS?

GOV.UK says that if you are eligible for Additional State Pension "you’ll automatically get it when you claim your State Pension". A contracted-out pension with a provider is a separate matter: ask the provider about it.

Is SERPS a private pension?

No. SERPS was part of the State scheme. What gets mixed up with it is the private money paid in when someone was contracted out.

Can I transfer a contracted-out pension?

A defined contribution pot can be moved to another provider, per GOV.UK, though a final salary scheme works differently and moving one has extra safeguards; see how to transfer a pension.

Your next step

Find out which kind of SERPS you have, using payslips, providers and the tracing service. If a UK defined contribution pot turns up and you are 50 or over, a Pension Wise appointment is free. Should you want the findings set beside the rest of your retirement money, an FCA-authorised adviser will phone after you submit the short enquiry form here, at no charge.