Savings mistake could see you lose 25 percent of cash – warning issued to Britons | Personal Finance | Finance

The financial services company AJ Bell has called for the charge to be reduced back to 20 percent.

The firm state that doing this would mean that a person making an early withdrawal of £1,611 would pay £322.20 rather than £402.75.

The decision to take the charge back to 25 percent did face backlash at the time of the increase with a petition against the move gaining nearly 20,000 signatures.

Tom Selby, head of retirement policy at AJ Bell commented: “Rather than just aiming to return the upfront Government bonus, the Treasury chooses to use the early withdrawal charge to clobber hardworking savers, with the charge effectively acting as a 6.25 percent penalty on unauthorised withdrawals.