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Full pension pot withdrawals jump 94% as lockdown eased

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18/11/2020
The number of people withdrawing all of their pension in one lump sum increased by 94% in the six months to September once lockdown restrictions started to ease.

In the same period last year, the number of people withdrawing all their pension money increased 51%, according to statistics from the Association of British Insurers (ABI).

It noted a big jump in pension savers accessing pots after a pause in activity during the first coronavirus lockdown earlier this year.

The ABI said the number of people accessing their pension as a flexible income increased 56% between April and September, though withdrawals are still down on 2019 levels.

The number of people buying a guaranteed income for life (annuity) increased by 41% while the number taking only a tax-free lump sum increased 55%.

Commenting on the rise, the ABI said people held back from withdrawals when stock markets were volatile while others may now need access to the cash after a change in circumstances.

However, compared to last year, it appears that many pension savers are still resisting the urge to raid their pension pots in the face of continued financial uncertainty.

Rob Yuille, head of long-term savings at the ABI, said: “Government restrictions, stock market volatility and employment prospects are just some of the factors weighing on pension savers’ minds when considering taking money out of their pension pot. Everyone is different and it is important to find the right solution for your circumstances. Getting financial advice or guidance can help provide options and clarity on what to do with your savings.”

He lists these top tips on things to consider when withdrawing money from your pension:

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