Hello all and welcome to the midriff of your week, slightly better padded than you have always convinced yourself you’d be at this age, and even o’er-hanging the belt slightly in the cruel September light. Such is the nature of affluence, my friends, and to sup as you do from the cup of Mammon and decry its effects is an affront to all that is good and right and true.  

We build our houses on the affluence of others in this sector, and we would do well to remember this. I suspect those who make their coin by being closest to clients feel it most sharply, but as you move out through the folds of the industry it’s all too easy to forget whose money it all is. And by the time you’re a burgeoning Leith-based research consultancy and communications agency? Forget it, mate.  

You’ll see why I’m banging on in this way in a second, but I am in reflective mood as it was 15 years ago on Monday that I packed myself down into the barrel of the corporate cannon and was ejected at some velocity. Over Edinburgh Castle I soared, breasting the Constipated Horseman and what at the time was still the St James Centre. The gentle downhill of Leith Walk broke my fall and I rolled past the Central, the Marksman and the Fit Ay The Walk before coming to rest at the Shore, and I’ve been there ever since. Fifteen years of lang cattery later, we are in fact all still here. Older, bigger (in all senses), balder, beardier, but importantly no wiser and no quieter. So a thank you from me to all who’ve been a part of this ride in the last decade and a half. I’ll buy you a drink if I see you. 

Right, enough of that. Let’s talk retirement income market statistics, which are just out (for tax year 24/25) and have various members of the industry puffing and blowing like they’ve been forced to run for a bus. You can find the FCA’s official stat attack here, and it is well worth reading.  

First up, lots more people are accessing their plans for the first time. Just over 960,000 bods did so, which is up 8.6% on last tax year. Annuity sales went up by a similar rate – 88,430 plumped for an annuity, up from 82,000 or so last year. Drawdown took a huge jump – up 25% and change to 350,000 new arrangements.  

The industry waved goodbye in one form or another to just under £71bn last tax year. That’s up 36% on the year before. To put it another way, that’s pretty much one Transact being withdrawn from the industry. There’s still plenty of pension money washing around, don’t worry, but that is a big jump. 

30% of plans accessed for the first time were done so by folk who had met an adviser; this is pretty steady on the previous year. Nearly 60,000 pots were over £250k; about 300,000 were under £10k.  

Right, so that’s what happened. First up, pensions were always made to be accessed. Regular readers may remember that I mounted an entirely spurious and unsuccessful campaign to remove the word ‘decumulation’ from the Universe and replace it with the acronym ‘GYMBOA’ which stands for Get Your Money Back Out Again. This is to remind our industry that it is the client’s money, not ours, and that it’s meant to go back out again so people can spend it on, like, food and heating and stuff. I’m already seeing too much commentary that assumes people accessing their pensions are doing so in some kind of madcap frenzy. Actually many, many people are capable of behaving rationally around money; it’s just that their version of rationality isn’t necessarily one which suits our industry. 

Anyway, that aside, m’colleague Lord Barrett of The Southern Islet notes that within the over £250k pot cohort we find,  

• 852 purchasing an annuity 

• 8,855 entering drawdown for the first time 

• 806 taking their first UFPLS payment 

• 195 making a full withdrawal 

…and all of these without taking any form of advice, and without even talking to Pension Wise. So most bigger pot-holders did take advice, but that’s still nearly 11,000 souls taking action which might well trigger some tax implications apart from anything else.  

That does feel iffy – one of the curses of affluence (and yes, a £250k pension pot lands you in that category) is that you have trade-offs and options to consider. And given that I’m still waiting for the benefits of pension simplification to kick in, I’m not sure that all of these non-advised individuals could possibly have got their head round the full implications of our insanely simple pensions and tax regime. 

As Mike says, this might be something that those tasked with getting Targeted Support up and going might concentrate on. At the very least there is potential harm here – and we shouldn’t ignore it, even if the answer is still that money leaves our clutches for its original intended purpose.  

For your music choice this week – it’s tempting to go back 15 years and maybe give you some Danzig from Deth Red Sabaoth. It’s also tempting to celebrate the passing of a true celebrity – that’s right, Tomas Lindberg of At The Gates has died of cancer. Only one year older than me. But we shall eschew all of these for the new Soen song. It’s an air-puncher so far as the music goes, and the lyrics are…well, they are what they are. Let’s just say few of us could do better in Swedish and leave it at that. Soen are great live and the time I saw them in London is one of the most memorable gigs of my life, despite the appalling drink I was pouring down my neck. Try and see them if you can. Meanwhile, here’s Primal.