Over the long haul, switching over to a defined contribution model would save taxpayers money while providing security for state workers in their retirement years.
The new rules will only apply to people with defined contribution (or money purchase) pensions.
Pension Wise is the government scheme that will offer 45-minute guidance sessions to anyone over 55 who has a defined contribution (or money purchase) pension.
It's almost certain that only those with a defined contribution (aka money purchase) pension will be able to access the new allowance.
More than 300,000 individuals a year with defined contribution (or "money purchase") pension savings will be able to access them as they wish after the age of 55.
From next month, more than 300,000 individuals a year with defined contribution or money purchase pensions will be able to access them as they wish after the age of 55.
At the moment, a member of a defined contribution (or "money purchase") workplace pension scheme who leaves after more than three months but less than two years may be entitled to receive a refund of the contributions they have paid in – in some cases with interest on top.
Described as the biggest revolution in British personal finances in decades, the new pensions regime means anyone aged 55 or over can now cash in their defined contribution (aka money purchase) pension and spend it on a sports car, invest in a buy-to-let property or put the money in the bank.
She added: "However, the good news is that the latest figures from the ONS show that those who are actively saving into a defined contribution [or money purchase] workplace pension are now saving more than last year, and their employers are investing more on their behalf, too".
"A misperception persists... that defined contribution plans 'save money' when compared with traditional pensions," the National Institute study says.
It means more than 300,000 people a year with defined contribution, also known as money purchase, pensions can access them once they turn 55.
