Year 1 of freedoms: £4.3bn flexibly accessed from pension pots

Over 230,000 people have used the new pension freedoms introduced one year ago, new HMRC statistics have shown this morning. Officials said that 232,000 people accessed £4.3billion flexibly from their pension pots via 516,000 payments.In the most recent quarter, 74,000 individuals withdrew £820 million. In the previous quarter, 67,000 individuals withdrew £800 million, HMRC reported.Just Retirement said a pattern that is emerging from these figures is that those with smaller pensions are more likely to be taking cash payment and lump sums have also been popular with those aged between 55-60, who account for half the cash being taken this way.Pension Wise has had over 2.2 million visits to the website and nearly 55,000 appointments to date.Stephen Lowe, group communications director at Just Retirement, said: "With figures for four quarters now available we can see that the initial "freedom frenzy" of the first two quarters when nearly £2.7 billion was withdrawn has fallen to £1.6 billion in the second two quarters."Another way of looking at it is that the average withdrawal in the first quarter of the new rules was nearly £13,000 but that has fallen in every subsequent quarter to reach less than £6,000 in the most recent period. It is good to see withdrawals moderating but the number of withdrawals has been climbing and £6,000 is still quite a chunk of most people's overall pension saving.”He said: "Putting these figures together with the ABI's recent pension freedom statistics, a picture is starting to emerge. Those with smaller pensions are more likely to be taking cash payments. Lump sums are also popular with those aged between 55-60 who account for half the cash being taken this way.“Overall £4.35 billion has been taken out of the pensions environment yet we still don't know is whether people are prioritising short-term consumption above long term income needs. The likelihood is that most people are acting sensibly but that a significant minority will end up regretting taking too much too soon.”

Year 1 of freedoms: £4.3bn flexibly accessed from pension pots

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