Pension freedoms have caused one in five people aged 50 plus to change their retirement plans, driven by the ability to access all of their pension savings from the age of 55.
Of the one in five who told Retirement Advantage they changed their plans, 44 per cent revealed they were planning to bring forward their retirement and retire early with 21 per cent expecting this to be brought forward by between one and three years and a further 23 per cent planning to retire at least four years earlier than originally expected.
However, 28 per cent of the 1,003 UK adults aged 50 plus who were polled by the provider in March said they now plan to retire later as a result of pension freedoms – with 13 per cent saying it will be by between one and three years later, while 16 per cent said it will be by at least 4 years.
Andrew Tully, pensions technical director at Retirement Advantage, said: "The increased awareness around pension flexibility has certainly made people sit up and rethink their retirement, with a significant number changing their plans as a result.
“Official data shows most pensions are now accessed before state pension age, which demonstrates what a game changer the pension freedoms have been. The regulator has recognised the need to alert people to the fact that your 55th birthday should not necessarily be a starting signal to begin accessing your pension.
“Whatever decisions people make on the back of flexibility around their pension choices, a critical first step will be to consult a professional financial adviser. An adviser will be best equipped to ensure that pension freedom ‘demob fever’ won’t cause problems further into retirement.”
The data also found that 29 per cent of people changing their plans are looking to work part-time in retirement. While 41 per cent of the women polled anticipate working part-time in retirement, only 20 per cent of men plan to do so.
Meanwhile men expect to retire one year earlier on average, while women do not envisage retiring earlier on average.
Alan Chan, director and chartered financial planner for London-based IFS Wealth & Pensions, said: “We have noticed this trend particularly with new clients and probably one in five is a good ballpark estimate.
"In our experience, in most cases accessing part of their pension at 55 does not normally cause a change to their retirement plans.
"Some may decide that they want to phase in retirement, by going part-time a few years earlier if they can afford to and take an income from the pension to supplement the difference.
"However, the reality is that many people cannot afford to do this, and will continue to work and save until age 65 plus. I think generally pensions freedom has been positive as the flexibility allows consumers to tailor their retirement as they desire."