Pensions - Articles - Towry comment on £1bn worth of pension savings cashed in

 “People who are considering cashing in their pension for a cash lump sum should ensure that they look before they leap. The proposal may sound attractive on the surface – a guaranteed one off payout – but everyone considering such a move should make sure they receive individual advice first.

 “This is because your pension pot may be your biggest source of income for the rest of your life. For people with health issues who might not expect to live for many more years, the prospect of a lump sum may be more attractive. But for others at or around the point of retirement, you may have many more years to live.

 “The real question, that has not been revealed by the Chancellor, is around the average percentage size of pension pots withdrawn by individuals. If the £1bn withdrawn is mostly individual small sums, then that’s not really a problem as it may well have been the best option for them. If people have been blowing large chunks of their life savings, however, then it is more worrying.”