The average annual pension withdrawal rate jumped more than one percentage point between 2016/17 and 2017/18, according to the latest data from the Financial Conduct Authority (FCA).
The regulator's retirement income data bulletin said the average withdrawal rate from drawdown or UFPLS (uncrystallised funds pension lump sum) pots - where a regular payment is set up - rose from 4.7% to 5.9% over the last two financial years. In this context, the FCA data compares the mid-point for each withdrawal rate band (see graph below). Although the financial watchdog's data shows many of the pots that were drawn down by 8% or more were small pots, more than 20,000 pots worth more than £100,000 were accessed at this higher rate. The following graph shows that a withdrawal rate...
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