Most wealth held by current retirees will be bequeathed on their death, rather than being spent during their retirement, research from the Institute for Fiscal Studies (IFS) found.
According to the reports - based on data from the English Longitudinal Study of Ageing (ELSA) - on average, individuals will drawdown just 31 per cent of net financial wealth between the ages of 70 and 90-years-old.
Even among individuals in the top half of the financial wealth distribution, net financial wealth looks to be drawn down by just 39 per cent, on average, the analysis concluded.
The possibility to drawdown or cash out a pension became easier after the introduction of pension freedoms in 2015.
The research from the institute found that for those aged between 55 and 64, the median housing wealth is £185,000, and median other wealth (excluding pensions) is around £33,000.
The study also found primary housing is the largest component of non-pension wealth held, around one-in-six of those aged 55 to 64-years-old own a second home, and most people do not appear to experience large end-of-life expenses that would use up remaining wealth holdings.
According to Rowena Crawford, associate director at Institute for Fiscal Studies (IFS) and author of the reports, the fact older people do not draw on their wealth much during retirement means that "most wealth held by retired people is likely to be bequeathed to future generations, rather than spent".
She said: "This will have implications for the level and distribution of resources among current working age individuals, particularly those with wealthy parents and few siblings.
"Given the increased freedom people now have over how they spend their pension wealth in retirement, carefully monitoring how the use of wealth evolves in future will be important, both for the living standards of the retirees themselves, and also for younger generations."
Sir Steve Webb, director of policy at Royal London and former pensions minister, argued that the Institute for Fiscal Studies (IFS) research confirmed the vast majority of pensioners who have saved through their working life are cautious with their money and leave unspent wealth at the end of their lives.
He said: "This is great news for those who believe in pension freedoms.
"The Institute for Fiscal Studies (IFS) research suggests that the biggest concern about pension freedoms is likely to be about excessively cautious retirees spending too slowly than it is about reckless retirees blowing their pension savings on lavish living."
According to figures from the Office for National Statistics (ONS), funds transferred out of pension schemes almost tripled to a record £34.2bn in 2017.
maria.espadinha@ft.com
