Next Spring and New Spending Habits of Pensioners
I wrote an article a few days ago predicting that next spring the papers will be full of articles about
pensioners cashing in their pensions to blow the money on holidays etc.
Well The Times beat my date forecast with a front page headline "200,000 will blow pensions next year".
The article is about a Mori poll which has found that 200,000 might cash in their pensions in the
year from March 2015. The percentages quoted by The Times add up to 153%, so I presume
that many people will have more than one use for the money, but the important thing to note is
that of the 200,000:
- 23% will save the money withdrawn
- 16% will reinvest it in property
- 13% will pay off debts
- 4% will reinvest in ISA's
which is not really my definition of "blowing it".
Also the second largest category at
- 22% said they would use it to live on
which begs many questions, and for example, for people with very small
funds this might make perfect sense.
This blog confirms
that the biggest winner in the short term will be HMRC with a predicted tax
windfall of £1.6 billion.