Pension freedoms payouts have dropped by more than £200m in the last quarter, according to the latest HM Revenue & Customs (HMRC) figures.
After the £1.77bn peak in the second quarter of this year, payouts dropped to £1.54bn in the third quarter, the latest figures show - similar to levels seen in the second quarter of 2015 (£1.56bn), the first period after the pension freedom legislation was introduced last April.
Some 324,000 payments were made to 158,000 people in the last quarter - the highest amount of payments made in one quarter since the advent of pension freedoms. More than £7.5bn has been withdrawn since George Osborne's pension freedom legislation came into effect.
Although quarterly payout figures are volatile - £820m was taken out in the first three months of 2016 before the £1.77bn post-freedom peak in the second quarter of 2016 - as the following graph shows, the average payout per individual has gently reduced since the freedoms were introduced.
The average withdrawal per person was just under £10,000 in the third quarter of this year, according to HMRC's figures. In the initial post-freedom rush in the second quarter of 2015, however, the average payout was around £19,000.
"These figures show that people are embracing the pension freedoms and flexible withdrawals have now become the default option for income in retirement," said AJ Bell senior analyst Tom Selby.
"It is interesting the average withdrawal per person has gradually reduced since the launch of the freedoms, suggesting the initial 'dash for cash' has tailed off and people are becoming more realistic about a sensible withdrawal level over time."
He added: "The pension freedom reforms were designed both to boost flexibility and make pensions more attractive. At the moment, the barometer of success seems to be focused purely on withdrawal rates, whereas the real measure of success will be whether people are saving more."
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