However, the company admits the Coronavirus outbreak could “rip” a double-digit hole in many future pension plans and hit those already in drawdown.

The firm commissioned an independent a survey of 500 people who have entered drawdown since 2015.

It found that:

• On average, Pension Freedoms withdrawals are now 4.4% of all private retirement pots – compared to 4.7% a year ago and 6.6% in 2017
• Pension Freedom withdrawals make up about a third (32%) of total income on average, with 70% of respondents saying they represent half their income or less
• Savers have withdrawn almost £33bn since the Pension Freedoms launched in April 2015

Other Key Findings included:

1.     Average value of private pensions: £152,000

2.     Average annual withdrawal: £6,694

3.     Average proportion of income from Pension Freedom withdrawals: 32%

4.     Proportion with other sources of income: 74%

5.     Proportion concerned about running out of money in retirement: 50%

While the survey suggests the Pension Freedoms have settled down, the company warns that the Coronavirus sell-off will require “hundreds of thousands” of investors to review their retirement income strategies to ensure they are sustainable.

Tom Selby, senior analyst at AJ Bell, said: “As the 5th anniversary of the Pension Preedoms reforms approaches this weekend, roughly 150,000 people a year who choose to stay invested while taking an income through drawdown face their biggest retirement challenge yet.

“Our research suggests, on average, annual withdrawals represent 4.4% of all private pension pots – a figure which has decreased every year we have carried out the survey.

“Although it is difficult to judge the sustainability of withdrawals without knowing people’s individual circumstances and overall wealth, a market characterised by people taking an income of between 4% and 5% who tend to have multiple sources of income may appear of little concern – particularly during a period where markets have risen at a healthy rate.

“However, the Coronavirus sell-off has changed everything, ripping a double-digit hole in millions of savers pension plans. While those who are building a retirement pot should have decades for their funds to (hopefully) recover value, people drawing an income already will likely have to adjust their spending expectations. This will particularly be the case for people in the early years of retirement who took significant withdrawals from their fund just as the current crisis hit.”

• AJ Bell commissioned an independent survey of 500 people who entered drawdown since April 2015 and are taking a regular income.  Research was carried out online in February and March.