Napf found 58 per cent of people prefer to receive a regular income for life rather than risk their money running out. Some 24 per cent agreed they expect they will take all of their pension savings in cash because they have other sources of income and 47 per cent were worried their pension would run out and they would need to rely on the state.
When asked, specifically 19 per cent agreed they would take the lump sum irrespective of whether they had other savings elsewhere. which Napf said was higher than the government had anticipated.
Around 23 per cent of Napf respondents thought they would need to save more than £150,000 to provide for a comfortable retirement. Worryingly, 28 per cent said they have “no idea how much they need to save”.
According to Napf, a pension pot of £150,000 would provide an individual with an annual income of just over £9,000 over a 25 year retirement, equating to £16,000 a year once the single tier state pension has been added.
Joanne Segars, Napf chief executive, said: “Greater flexibility brings greater responsibilities and the decisions people will need to make when they reach retirement are undoubtedly complex.
“The government has said that people should receive free face-to-face guidance at the point of retirement, but it is not clear how this service will be delivered or who should be responsible for it.”