According to new research by self-invested personal pensions provider, Liberty Sipp, a fifth of Brits plan to use their pension savings to splash out on a car.
Of the 600 surveyed, it was discovered that 20 per cent would use their pension pot to buy a car once the pension rules change in April.
Ironically, Steve Webb, pensions minister, noted it would be people’s own decision what they did with their money when he announced the reforms, saying it would be their “choice” if they wanted to blow their life’s savings on a Lamborghini.
In line with the more relaxed rules, the research found that only 7 per cent of Britains plan to buy an annuity when they retire.
However, 58 per cent of those surveyed plan to keep part of their pot invested in a pension scheme once they retire.
A total of 3 per cent of Brits plan to give some of their pension away to family members.
Fewer Brits - 12 per cent of respondents in the Liberty Sipp poll - plan to use their pension savings to buy a holiday than to buy a car.
A study in Australia found a similarly high proportion of people would look to spend their money on cars, with Australians already eable to spend their pension pots as they wish when they reach retirement.
The study by Challenger Retirement Income Research found 19 per cent of Australians use their pension savings to buy or pay off a car, and one in eight use their savings to fund a holiday.
John Fox, managing director of Liberty Sipp, said: “Next year’s changes to the rules on pensions are nothing short of revolutionary and will give retirees more freedom than ever before.
“But our research shows that many will use that freedom to treat themselves. The lure of a new car or a nice holiday has proved irresistible for many Australians; now a similar proportion of Brits are set to succumb to the same temptation when they retire.
“On this evidence, Britain’s car dealers may be expecting a bumper 2015.”
