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Retiree’s lack of confidence cause of stasis over pension freedoms

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  • 07/07/2015
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Retiree’s lack of confidence cause of stasis over pension freedoms
Nearly three-quarters (73%) of eligible pension savers have chosen not to withdraw cash from their funds since new pension freedoms became available on 6 April.

Research found that despite 60% of survey respondents stating in April that they intended to take cash from their pension fund, only 9% have actually done so and 18% are still undecided.

The survey from Avacade Future Solutions, compared the intentions of UK pension holders towards the reforms in April 2015 versus their actual financial actions post the reforms in June 2015.

One in five (21%) planned to put their money into a savings account, yet only 3% had actually done so, according to the findings. Some 13% planned to go on holiday or invest their money, but only 2% of pensioners have completed either objective.

Almost one in 10 (9%) intended to invest in property or pay off a mortgage – but only 1% have done so.

Researchers said that the divergence that stands between pension planners’ intentions and actions highlights “an overwhelming lack of consumer confidence”.

More than one in 10 UK pension planners did not feel they had received sufficient guidance in order to make a wise decision, with 13% concerned they would make an irrecoverable mistake.

Lee Lummis, CEO of Avacade, said: “The disparity that stands between pensioner intentions versus their actual actions is shocking, and the reason behind this is something we encounter on a daily basis. The difference from 60% planning on taking out a cash lump sum to just 9% doing so highlights that the effect of the reforms is being hindered as many pension planners are confused by the changes and cannot decide the best route to achieve their pension objectives.”

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