Flexible payments from pensions.
Some 159,000 people accessed £1.7bn of their pensions flexibly in the second quarter of 2016, according to HMRC. This is nearly twice as many as in the corresponding period in 2015 and takes the total value to more than £6bn across 772,000 payments since the launch of the pension freedoms.
Tom McPhail, head of retirement policy at Hargreaves Lansdown, said the figures corresponded to a significant decline in annuity sales.
Drawing cash from a pension had become ‘the new normal’, he said, adding: ‘We would also expect the numbers to accumulate over time, with more and more people reaching an age where this type of financial planning becomes relevant to them. The start of the new tax year is also an obvious trigger for withdrawals for prudent tax planning.’