THREE in four people will shun buying an annuity with their pension pot following chancellor George Osborne’s radical shake-up of the pension market, fresh research suggests.
Just 25 per cent of pension savers polled by consultancy Hymans Robertson said they would use all of their lifetime savings to buy an annuity, which converts a pot of cash into a annual salary at retirement.
The shift in sentiment follows Osborne’s decision in the Budget to scrap rules forcing savers to buy an annuity when they approached retirement. “The chancellor’s Budget changes aren’t yet cold, but the mind-set of savers is clearly already changing,” Hymans partner Chris Noon said.
A further 32 per cent said they would spent a small portion of cash on an annuity and 31 per cent said they would draw income from their pot of cash each year. Around 12 per cent said they would draw all the cash.
Men are more confident about managing their own pension pot, with about 64 per cent of men bullish about self-managing their money versus 56 per cent of women. Seven in ten high earners also said they were confident.