Risks of pension freedom

A RECORD one million Britons are turning 55 this year and can dip into their pensions for the first time, but experts warn many could ruin their retirement by making simple errors.

- Harvey Jones

The pension freedoms that came into force in 2015 put people in charge of their retirement savings, but they need to be handled with care.

Savers who rush to withdraw money from their pension funds could end up locking in the losses they made during the stock market crash, while incurring a major tax bill. This is a concern as half of those turning 55 this year say they know little about pension freedoms, while one in 10 have never heard of them.

Despite that, more than half plan to draw some money from their pension before they reach State pension age.

The research comes from pensions provider Standard Life, which warned that many risk depleting retirement savings too quickly and running short of money in later life.