The number of people accessing their pension pots dropped in the third quarter of 2015.
According to the latest figures by Financial Conduct Authority (FCA), 178,990 pensions were accessed between July and September 2015 after pension freedoms came into effect last April.
This was a 13% drop from the 204,581 pensions accessed between April and June 2015.
Of the 178,990 pensions that were accessed:
- 68% of pensions (120,969) were fully cashed out, of which 88% were small pot pensions
- 32% (58,021) were used to take an income after tax free cash
- 34% (60,600) were accessed using both partial and full withdrawals
- 30% (54,604) used income drawdown
- 13% (23,383) were used to purchase an annuity
- 23% (40,401) were full withdrawals using small pot lump sum payments.
Figures also found that fewer people are using the free advice pension service. Just 17% of those withdrawing money from their savings pots reported making use of the Pension Wise service.
With regards to their pension provider, many consumers are choosing to stay with their existing one rather than switch. 58% of those going into a drawdown and 64% of those purchasing an annuity stayed with current provider when doing so.