232,000 have used pension flexibility freedoms in it’s first year say HMRC
Nearly a quarter of a million of exercised new freedoms that enable them to use their pension pots more freely according to information from HMRC.
According to a statement, people who have “worked hard and saved their entire lives” have now accessed £4.3 billion worth of flexibility from those pensions pots.
The Pension Wise service has also proved popular, with 2.2 million visits to it’s website and 55,000 appointments to date,
The government announced that it will be capping early exit fees, allowing earlier access to Pension Wise guidance, and working with industry to introduce a Pensions Dashboard.
It has also announced that it is extending the popular freedoms even further, giving millions more people the right to sell their annuities if it’s best for them from April 2017.
The Economic Secretary to the Treasury, Harriett Baldwin said: “It’s only right that people should have a choice over what they do with their money and in their first year our successful pension freedoms have already given thousands of people access and responsibility over their hard-earned savings.
“We will continue to make sure that the pension freedoms work well for everyone, including through working with our partners to ensure consumers are protected and that there is simple information to help people understand their options.”
Gareth Shaw, head of consumer affairs at Saga Investment Services, said: “The 232,000 savers who have accessed their pension since April 2015 have done so on multiple occasions – 516,000 in fact – reflecting that people are dipping in and out of their pension as and when they need to.
“While data from other sources, such as the Financial Conduct Authority, show that many people have withdrawn larger amounts from their pension, this data shows an average withdrawal of just £18,750 – hardly Lamborghini money.”
“What’s missing is the amount of tax revenue generated – this is likely to have well exceeded the government’s initial tax expectations of £320m.”