Personal Pension  

FCA pension data shows first fall in dash for cash

FCA pension data shows first fall in dash for cash

Financial Conduct Authority data has showed a decline in the number of consumers accessing their pension pots for the first time since pension freedoms gave them complete access to their savings.

The quarterly retirement income market data, which surveyed 56 groups comprising 94 retirement and pensions providers, covered an estimated 95 per cent of contract-based scheme assets.

Over the period between 1 October and 31 December 2015, a total of 127,094 pensions were accessed by consumers, to take either an income or withdraw money as cash.

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This represents a 36 per cent decrease from the previous quarter’s figures, with 194,433 pensions accessed for the first time between July and September.

A total of 21,289 annuities were purchased during the quarter, down 9 per cent from the previous quarter’s total of 23,385.

There were 65,610 full cash withdrawals by new customers over the same period, also down 42 per cent from the previous quarter’s figure of 113,100.

Elsewhere, the FCA broke down the use of regulated advisers against product type:

Use of regulated advisers

Percentage of product purchases and withdrawals where provider has recorded use of a regulated adviser (October - December 2015)

Annuities42%
Drawdown68%
Full withdrawal37%
Uncrystallised fund pension lump sum34%

In total, 23,062 drawdown purchases and 8,776 annuity purchases were recorded during October to December by providers as using a regulated adviser.

Over the same period, 14,955 pensions with guaranteed annuity rates were accessed, and of those, 63 per cent of GARs were not taken up during this period.

Alongside this, 53 per cent of drawdown and 57 per cent of annuities purchases were made by firms’ existing customers during the fourth quarter; a similar figure to the previous quarter.

Customers aged 55 to 59 had the highest level of withdrawals as a percentage of their pension pot, with 11 per cent of these customers taking an income of 10 per cent or more of their pot.

ruth.gillbe@ft.com