One hundred days into pension freedoms we can see that Brits are pretty sensible with their cash - despite accessing £1.8 billion from their savings.
Pension freedoms heralded a huge shake-up of the way we pay for retirement. It gives retirees the ability to keep their money invested through drawdown and take income and lump sums when they need. Or they can cash in their pension pot and go on a cruise. Crucially, they no longer have to annuitise their pension.
The choice is their own, and figures from the Association of British Insurers show that £1.8 billion has been taken out of pensions since April, with the average amount accessed standing at £15,500.
While £15,500 is a lot of money, the good news is that people aren't raiding huge sums from their pensions. The ABI Said the average annuity was purchased with a pot of £55,750 and a typical fund being placed into drawdown was £69,900.
This shows that retirees are being imminently sensible with larger pots of money and it's probably right to say if you have a decent sized savings pots you shouldn't take it out as cash.
And it has stuck with the £30,000 rule as those with defined benefit pensions above that amount have to take advice if they want to transfer out and take it as cash.
When taking cash, which it comes down to is whether the income the pension will provide is a meaningful amount. You could argue that a £30,000 pension pot generating around £600 a year isn't meaningful as income but could be a huge boost to someone when taken as cash. It could pay off a mortgage or other debt, or pay for a family trip to a place you've always wanted to go. As a lump sum it could be life changing.
And let's also take into account other pension provision. If you have a DB scheme paying you a set amount of income each year then £30,000 might be nothing in the big scheme of things.
Of course, an extra £600 of income a year for someone on the state pension could also be life changing – it depends entirely on circumstance.
Pensions may not be glamorous but at least the pension freedoms have made us realise they can be meaningful.
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