Representing some 57% of assets, this group outnumbered the 14% of retirees that opted for traditional annuity products and 3% who chose BlackRock’s new income drawdown product, the Retirement Income Account.
This data conflicts with a national survey which suggests 73% of pensioners have not taken out a cash lump sum, despite 60% saying they planned to upon learning of the reforms back in April.
Lee Lummis, CEO of Avacade, which compiled the research of 2,000 respondents, spoke of a “shocking” disparity between pensioner intentions versus their actions.
“The difference from 60% planning on taking out a cash lump sum to just 9% doing so highlights that the effect of the reforms is being hindered as many pension planners are confused by the changes and cannot decide the best route to achieve their pension objectives,” he said.
Still, Paul Bucksey, head of BlackRock’s UK defined contribution business, was defiant that the firm’s experience had indicated the “emergence of a new norm” in pension planning.
“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.
“We were ready from day one and have been successfully paying out cash payments without exit fees, and also setting up new drawdown accounts for those who are looking for greater flexibility and want to remain invested.”
