Paying off debt, home improvements, holidays and even starting a new business are all popular uses of pension cash withdrawals, July figures from Fidelity Worldwide Investment have shown.

Using data from Fidelity’s call centres, the biggest theme by far was debt repayment with 29% wishing to pay off either unsecured loans or a mortgage. This was closely followed by re-investment of monies with 21% putting funds into some other financial product. Positively, customers also want to enjoy themselves with over one in eight (12%) looking to do home improvements, 5% planning to go on holiday and a further 2% stating they want to either set up a business or take up an adult education course. And with separation a growing theme among the over 50s, 2% intend to use the cash to fund a divorce. 

Richard Parkin, Head of Retirement at Fidelity Worldwide Investment said:

“Retirement nowadays is not about sitting in your slippers and patting the dog all day – although if you want to do that then you absolutely should. People are fitter, engaged and view retirement as the time to actually go and do all the things they’ve wanted to do for a while; be it do up the house, enrol in a course or set up their own business.

“Despite predictions that retirees were set to withdraw all their cash in some mad scramble, we’ve not seen this. Absolutely, people have taken out smaller pots but we’ve not seen a stampede whereby customers don’t care about tax or having money for further down the line. This is not entirely surprising when you consider that people have spent 40 years actually building their pot up in the first place.

“What’s important is that people have a financial plan for retirement. This means not just making sure they have what they need to last their retirement but that they feel able to spend money today on the things that are important to them. Everybody talks about the risk of running out of money before you die but there’s another risk. That is being too afraid to spend money so that you don’t get to enjoy the retirement that you’ve saved so hard for. People should seek expert help and advice in putting together a plan that works for them so they can get the most from their retirement.”