A total of £12.7bn has been withdrawn from pensions since freedom and choice was introduced in April 2015, according to latest HM Revenue & Customs (HMRC) statistics.
At the end of 2016, the total figure reached £9.2bn, and has since increased by £3.5bn in the two quarters of 2017, with an all-time high of £1.9bn withdrawn in Q2, compared to £1.6bn in Q1.
Despite the total increase, average withdrawals per individual have continued to fall – a trend seen since the introduction of the freedoms. The average size of withdrawals per person decreased to £9,300 in the second quarter of 2017, from £11,132 in the same quarter of 2016. The average number of payments per person was up from 1.86 in Q2 2016 to 1.92 in Q2 2017, which suggests more people are setting up regular withdrawals rather than taking ad-hoc lump sums.
“These figures show that more and more people every quarter are taking advantage of the new pension freedoms.
“Any future government would find it politically impossible to reverse this policy which is now a significant part of the retirement planning of large numbers of people.
“The priority for regulators must be to ensure that people are given the right guidance and advice to make best use of these freedoms.”
Royal London director of policy Steve Webb
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