Since April 2015, individuals aged 55 and over have been given unfettered access to their pension savings. Three years on from the pension reforms, figures released from HMRC have revealed that £17.5bn has been flexibly withdrawn.
Half a million flexible payments have already been made to over 200,000 people in the first three months of 2018, with the average withdrawal per person at £7,644.
The FCA’s interim report of its Retirement Outcomes Review revealed that more than half of fully withdrawn pension pots were not spent, but were moved into other savings and investments instead. This has raised concern, as consumers could be paying too much tax whilst also forgoing any investment growth. Recent research by Prudential also highlighted that two out of three people over the age of 55 are still confused by the pension freedoms regulations.
Seek advice before taking action
The latest figures reinforce the importance of seeking financial advice before taking advantage of the pension reforms. To help you make the most of your savings and maximise the tax advantages, contact our specialist team to arrange your free no-obligation Pension Review with our specialist team. Call us on 01794 525500 or email firstname.lastname@example.org.