BI_why (not)? | Philips Pensioenfonds

Checked on: 17 June 2024

Why or why not to opt for ‘lump sum’?

At the time of payment	The following years
You can choose any amount between 0% and 10% to receive at once, as long as the remaining pension remains above the minimum commutation value stipulated by law (€ 592.51 gross per year in 2024). Do you want to calculate the ‘lump sum’? An example can be found under 'Frequently asked questions' on the previous page. The money is completely free to spend. Think of a big trip, (partial) repayment of your mortgage, adapt your house to your changing needs, making your house more sustainable or maybe as a gift to your (grand)children. It is best to choose ‘lump sum' if you have something to spend the money on. Next to the option 'lump sum', you can also bring your pension forward in time with the options ‘bridging pension’ and the ‘high-low arrangement’. Those options may be more attractive to you, depending on your personal situation. In Britain there are warnings about pension scam: criminals who encourage you to invest the money in high-risk projects. The victims often lose (a large part of) their money. If you opt for ‘lump sum’, think carefully about what you want to spend the money on.	If you choose to receive 10% of your retirement pension at once, there will be 10% less left for your monthly pension income. You will receive that lower pension income as long as you live. If we increase your pension through indexation and you have opted for a lump sum, you will receive less indexation, because it is based on the amount of the remaining retirement pension. The part that is paid at once is also not eligible for compensation for missed indexation. If you deposit the lump sum into your savings account, you may have to pay income tax, if your savings exceed a certain limit; the capital tax (in Dutch vermogensrendementsheffing).

At the time of payment

The following years

You can choose any amount between 0% and 10% to receive at once, as long as the remaining pension remains above the minimum commutation value stipulated by law (€ 592.51 gross per year in 2024). Do you want to calculate the ‘lump sum’? An example can be found under 'Frequently asked questions' on the previous page.
The money is completely free to spend. Think of a big trip, (partial) repayment of your mortgage, adapt your house to your changing needs, making your house more sustainable or maybe as a gift to your (grand)children. It is best to choose ‘lump sum' if you have something to spend the money on.
Next to the option 'lump sum', you can also bring your pension forward in time with the options ‘bridging pension’ and the ‘high-low arrangement’. Those options may be more attractive to you, depending on your personal situation.
In Britain there are warnings about pension scam: criminals who encourage you to invest the money in high-risk projects. The victims often lose (a large part of) their money. If you opt for ‘lump sum’, think carefully about what you want to spend the money on.

If you choose to receive 10% of your retirement pension at once, there will be 10% less left for your monthly pension income. You will receive that lower pension income as long as you live.
If we increase your pension through indexation and you have opted for a lump sum, you will receive less indexation, because it is based on the amount of the remaining retirement pension. The part that is paid at once is also not eligible for compensation for missed indexation.
If you deposit the lump sum into your savings account, you may have to pay income tax, if your savings exceed a certain limit; the capital tax (in Dutch vermogensrendementsheffing).

Adres	Postbus 123 1180 AC Amstelveen
Phone	+31 (0)88 - 015 79 00
Email	info@philipspensioenfonds.nl

Lump sum

Why or why not to opt for ‘lump sum’?

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