Changes introduced in April allow pension savers to take cash from their pot at any time, in chunks or all at once.
More than a third (34%) of BlackRock’s customers took formal financial advice, with over six in 10 (61%) accessing the government’s Pension Wise service. Within these groups 21% sought advice from both sources.
Paul Bucksey, head of BlackRock’s UK defined contribution business, said that the signs indicate the emergence of a new norm. “The pension freedoms have changed the way people are choosing to access their retirement savings – and for the better in our view, as people are using them to take more control of their finances,” he said.
BlackRock also announced that 3% of its customers are using their drawdown product, which it described as a ‘significant’ number. This group represents almost a quarter (23%) of assets handled by the company.
A drawdown pension allows the policy holder to withdraw an annual income directly from the pot, rather than using the savings to buy an annuity from an insurance company.
“We have not been surprised by the take-up for drawdown as an alternative to annuities,” said Bucksey. “What this early data shows is that many people want to retain as much flexibility as possible.”