The popularity of drawdown as a retirement option is on the up again, latest data suggests.
Half of consumers opted for drawdown between April 2018 and April 2019, compared to 36 per cent that took an annuity and 14 per cent taking a cash lump sum, according to EValue’s Pension Freedom Index.
The study analyses the choices made by 86,000 people using EValue’s guidance tool.
While drawdown has always been the preferred option of those using the tool, EValue says it has become more common again this year, as has the option of taking a cash lump sum, which is up 3 percentage points on 2018.
Men were slight more likely to opt for drawdown than women, who showed more consistency in their choices between quarters. However, women were slightly more likely to take lump sums.
All generations prefer drawdown to annuities, though older groups – Generation X and Baby Boomers – have a clearer preference for drawdown.
EValue chief executive Paul McNamara says: “The Pension Freedom Index provides an insight into how consumers are exploring their retirement options. The Index also enables our clients to understand the choices that are being made to better support their customers’ needs…It is great to see the emergence of the younger generation using our tool to aid their pension decisions and we encourage consumers to continue to explore their options as circumstances change.”