A record £3.57bn was withdrawn ‘flexibly’ by pension savers in Q2 2022, new figures published by HMRC have shown.

According to HMRC, just over half a million people took money out of their pensions during Q2 2022, and on average they did so two or three times (with 1.225 million withdrawals in total). The amount taken was the highest quarterly figure since Pension Freedoms were introduced in 2015 and is up over £1bn on the figure for Q1 2022 (£2.33bn).

Although there are some seasonal variations in withdrawal rates, the Q2 2022 figure is also 23% up on a year earlier.

LCP partner Steve Webb said: “These dramatic figures are the clearest sign yet that people are turning to their pensions to help them with the cost of living crisis. In Spring of this year pensions and benefits only rose by around 3% when inflation was already around 9%. For those who have run down cash savings, it seems that the pension is their next port of call. It would be worrying if the only way people could cope with the cost of living crisis was by ravaging their living standards in retirement”.

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