PEOPLE taking out retirement savings are being caught out by unexpected taxes and welfare reductions, a study showed yesterday.
A survey of 500 adults who accessed pensions since new freedoms came into force last year showed that one in 10 had unforeseen tax problems such as deductions, rising to almost a third among those taking their whole pension pot in one go.
Citizens Advice said its research revealed that almost one in three put the money into a bank account and a similar number used the cash for daily living costs, while others paid off debts.
Citizens Advice chief executive Gillian Guy said: “The pension freedoms are popular with consumers but some people are experiencing unexpected losses.
“The changes are giving huge numbers of people the choice of how to access their retirement savings, offering them more options about how to use the money to best fit their lives.”