Cash point


More than one mil­lion pen­sion pots have been dipped into since the pen­sion free­doms were in­tro­duced in April 2015.

Savers aren’t raid­ing funds to buy fast cars, but there are huge con­cerns that they’re pan­ick­ing and tak­ing cash too early.

The Fi­nan­cial Con­duct Au­thor­ity’s lat­est mar­ket re­view re­veals that al­most three-quar­ters of pots were ac­cessed by un­der-65s – and more than half were to­tally emp­tied.

Con­fu­sion over the com­plex changes and a dis­trust of the pen­sions in­dus­try means that more than half of the cash taken was trans­ferred into other sav­ings and in­vest­ments. An­drew Tully, pen­sions tech­ni­cal di­rec­tor at Re­tire­ment Ad­van­tage, said: “The pen­sion free­doms have opened up a Pan­dora’s box. Peo­ple are wor­ried about do­ing the wrong thing, but are not get­ting proper fi­nan­cial ad­vice.

“Many are go­ing for the op­tion they un­der­stand – tak­ing cash. With­draw­ing money from a tax-ef­fi­cient pen­sion to sim­ply place on de­posit is frankly bonkers.”

Re­mem­ber, there’s no need to ac­cess a pen­sion if you’ve no plans to spend it. That just leaves you at risk of pay­ing too much tax, and from fraud­sters wait­ing to re­lieve you of your money.

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