The proportion of savers accessing a pension for the first time using regulated advice has fallen, new FCA figures show.
Its data shows that of the 962,000 pension plans that were accessed in 2024-25, less than a third (31%) were taken after receiving regulated advice.
Most significant, because of the extra costs, complexity and risk, are the 350,000 drawdown plans accessed for the first time, where only 45% were taken after receiving advice. This compares to 66% in 2018-19 and shows a falling trend for six years in a row.
In addition, the number of pots accessed after using Pension Wise – the government’s free guidance service – only accounted for one in 10 (11%).
Stephen Lowe, group communications director at retirement specialist Just Group, said: “The figures show a 9% rise in pensions accessed to 961,575 which was largely driven by a 25% rise in drawdown plans to 349,992.
“While the numbers accessing pensions and using advice are up, the proportion of customers using advice has fallen for each withdrawal option since last year. The downward trend in use of advice for drawdown over time is particularly obvious and should be seen as a red flag.
“It is important that customers go into drawdown with their eyes open about the need to manage withdrawals to navigate the investment and longevity risk. Understanding these risks will help them improve the probabilities that their savings continue to deliver the income needed to last throughout their retirement.
“Regulators said they would uncover better stimulus, incentives and processes to ensure a higher proportion of pension savers would benefit from using Pension Wise. This data confirms no progress has been achieved.
“Retirement decisions are some of the trickiest financial decisions that people will ever face. It’s worrying that most pensions accessed – nearly six in 10 – are taken without professional advice or guidance.
“We are just over a decade into the ‘freedom and choice’ policy experiment so these are still relatively early days for understanding what people are doing across all their pension pots and other assets.
“The industry has been developing new advice models to bring the benefits of regulated advice to a wider audience. In the future, targeted support options may help more savers.
“In the meantime, we would strongly urge anyone thinking of accessing a pension to seek regulated advice or, failing that, they should at least take guidance from Pension Wise which will help to sense-check their plans and make them aware of common pitfalls and scams.”
