Three in five retirees who withdrew tax-free cash from their pension ahead of last year's Budget now regret doing so, according to research from wealth manager Quilter, which has called for earlier government clarity ahead of the 2026 Budget.

A survey of more than 5,000 UK retirees for the wealth manager in March and April found that 57% withdrew tax-free cash before the Budget, with 41% saying they acted because they feared changes to pension rules. Of those who made withdrawals, 61% later said they regretted the decision.

Quilter said speculation that the 25% tax-free lump sum could be reduced or capped prompted many retirees to make unnecessary withdrawals, despite no policy changes being announced. The money was commonly used for home improvements, healthcare, gifts to grandchildren or everyday living costs.

According to Quilter, the findings show how speculation around potential policy changes can prompt rushed decisions that may not always be in people’s long term financial interests.

Jon Greer, head of retirement policy at Quilter, said: "This data shows how speculation ahead of last year’s budget led many retirees to act out of fear of losing what is a vital component of their retirement provision rather than genuine need at that moment. The fact so many regret doing so highlights the real harm that can come from making decisions driven by rumour."

Greer added: "This research underlines just how sensitive retirement planning has become to continuous budget speculation. Those saving towards and planning their retirement need and deserve certainty. Earlier and clearer communication could have avoided a lot of unnecessary worry and poor decision making, and that lesson must be taken into future budgets."

---