Over three quarters of adults are not confident about how to access their pension

Over three-quarters of UK adults (77%) are not confident about how to access their pension according to research by Standard Life.

The research also highlights that more information around options at retirement would help people make confident decisions, as nearly two fifths (37%) feel they should have sought advice or guidance before they accessed their pension savings.

Dean Butler, Managing Director for Retail Direct at Standard Life said “With less than 10% of people in the UK taking financial advice it’s unsurprising that very few feel confident about making decisions around accessing their pension savings, and many wish they had taken advice before they did so. It’s important that people are able to understand how their retirement finances work, and what their options are, so they can make informed decisions about what’s best for their futures. What’s right for one person’s circumstances might not be for another.

“If you have a Defined Benefit (DB) pension, which usually offers a guaranteed income from your employer until you die, options tend to be fairly limited. This means less freedom in how you take your money but more reassurance that you can’t go far wrong. If you have a Defined Contribution (DC) pension, as most people actively saving now do, things are a bit more complicated. Generally, you have a few options – take all your money, take some of your money and leave the rest invested, while ‘drawing down’ monthly income from it, or using your pension money to buy an annuity, which provides a guaranteed income in retirement. It’s also possible to take a ‘mix and match’ approach to your retirement income which could help you achieve the best of both worlds, if you annuitise a portion of your income to cover essential outgoings, and leave the rest in drawdown to access as and when you need it. With annuity rates sitting at around 6.6% for a healthy 65-year-old, it could be a good time to consider how a guaranteed income can fit within your wider retirement income mix.”