The latest figures reveal that consumers are continuing to take advantage of the pension freedoms as withdrawals reach £10 billion.
Data from HM Revenue and Customs indicates that during the first quarter of 2017, 381,000 flexible payments were drawn out by 176,000 individuals, totalling £1.59 billion.
Despite being the highest figure for three consecutive quarters, the peak of £1.77 billion in the second quarter of 2016 was not quite reached.
Since the freedoms came into effect during April 2015, a total of £10.8 billion has been withdrawn.
Despite interest and thus demand falling slightly in the last quarter of 2015 and Q1 of 2016, this seems to have now plateaued, with demand flattening.
Commenting on the payout total was Tom McPhail. The head of policy at Hargreaves Lansdown stated:
“After the initial bow-wave of demand in the first two quarters of 2015, the retirement income market appears to have settled and stabilised remarkably quickly. Annuity transactions (reported elsewhere) have stabilised too at around 20,000 a quarter; so all this data suggests the pension freedom reforms are bedding in well.
“We would like to see policymakers producing more detailed qualitative analysis now, digging into individual investors’ circumstances and decision-making to make sure they’re not going to be running out of money 15 years from now.”
