Of individuals that accessed their pension pots for the first time in the last year, 48 percent were done so without taking regulated financial advice or guidance.
This finding comes from the Financial Conduct Authority’s (FCA) retirement income market data for the period between April 1 2018 and March 31 2019.
The data is collected from all regulated firms that provide retirement income products and shows the actions that individuals have taken the first time they access a pension pot.
The data found that, in total, 646,530 pensions were accessed for the first time to either buy an annuity, move into drawdown or take a cash withdrawal.
Of these pensions, 55 percent were fully withdrawn and a further 30 percent entered into income drawdown.
More than 10 percent (11) of pensions were accessed to purchase an annuity - which have continued to decline steadily as a proportion of all pension withdrawals.
A further four percent were accessed to take partial lump sum payments from uncrystallised funds.
For pensions that entered income drawdown, 34 percent of plan holders did not take regulated financial advice, although nine percent received Pensions Wise guidance.
Less than half (46 percent) of pensions going into income drawdown were sold to new customers, rather than to existing customers with the firm.
Jonathan Watts-Lay, director at WEALTH at work, said: “All these findings demonstrate why the provision of financial education, guidance and regulated financial advice by a reputable provider is more important than ever. And why employers and trustees need to do everything in their power to ensure that the right level of support is provided to all employees and scheme members when they need it.”