- Almost half (49%) of the over 55s with a private pension are unsure or don’t know what benefits they are planning to take when they first access their pension
- A quarter (25%) of over 55s plan to take the tax free lump sum and draw an income
- One in six (16%) of the over 55s are planning to take a tax free cash lump sum and leave the remainder in a pension
Almost half (49%) of the over 55s with private pension savings are unsure about how they are going to access their savings, according to new research1 from Canada Life. The insight also reveals nearly a quarter of the over 55s with pension savings are planning to withdraw the tax free cash lump sum and draw an income with the balance of their funds.
A minority (3%) plan to cash in all of their pensions when they first access them, while a further 6% said they would cash in one of their smaller pensions.
Andrew Tully, technical director, Canada Life commented:
“Pensions can be a complicated area of financial planning, and none more so than when you are considering your options at-retirement. That might explain how nearly half of our respondents were unsure or didn’t know how they were going to access their pension for the first time.
“Unfortunately far too many people think they can adopt a DIY approach and navigate the myriad of options without help. This can catch people out, whether that be falling foul of the annual allowance rules, or paying more tax than necessary on any withdrawals.
“A regulated financial adviser will be best placed to not only help explain the choices when people are considering accessing their pension savings for the first time, but will also keep them on the right track as they progress their retirement journeys.”
Source: Research by Opinium on behalf of Canada Life
1. Research conducted among 2,000 UK adults (including 1,222 over 55s with a private pension) in August 2019