Pension freedoms could see millions run out of retirement cash - Age UK

clock

Additional safeguards should be placed on pension freedoms to ensure people do not burn through their pension pots in the first years of retirement or get caught out under tax rules, Age UK has said.

Research from the charity said pensioners could exhaust their retirement savings by age 75 if they withdraw an annual £3,000 from an above-average sized pot. The £29,000 sum would run dry by 74 if the withdrawal increased with the annual rate of inflation, assuming the worker retired at 65 and the rest of their savings matured at a rate of 3% per year, Age UK warned. The effects could be worse for employees who have median pots of £20,000, the charity said. Its Dashboards and Jam Jars report found people could run out of cash by age 76 even if their pot grew at an annual rate of 5%...

To continue reading this article...

Join Professional Adviser for free

  • Unlimited access to real-time news, industry insights and market intelligence
  • Stay ahead of the curve with spotlights on emerging trends and technologies
  • Receive breaking news stories straight to your inbox in the daily newsletters
  • Make smart business decisions with the latest developments in regulation, investing retirement and protection
  • Members-only access to the editor’s weekly Friday commentary
  • Be the first to hear about our events and awards programmes

Join

 

Already a Professional Adviser member?

Login

More on Pensions

Pensions campaigner and former WPC chair Frank Field dies aged 81

Pensions campaigner and former WPC chair Frank Field dies aged 81

Field was a former Work and Pensions Committee chair and a welfare champion

Professional Pensions
clock 24 April 2024 • 5 min read
Crucial advice issue: Death benefits detail advisers need to know

Crucial advice issue: Death benefits detail advisers need to know

Important differences from previous regime

Andrew Tully
clock 05 April 2024 • 4 min read
British Steel a stark reminder of obligations around client files

British Steel a stark reminder of obligations around client files

Lawyer Philippa Hann reflects on her work around the pensions case

Hope Coumbe
clock 27 March 2024 • 2 min read