Individuals could be at risk of running short of retirement funds after cashing in their pension pots, analysis of overseas schemes suggests.
The Social Market Foundation, a left of centre think tank, studied policies in Australia and the US that are similar to the UK’s pension reforms.
It found a significant proportion of people withdraw funds at an unsustainable rate.
In the UK, thousands have cashed in their pension pots since April.
The new rules, which came into force in April, allow pension savers to cash in their pension pots from the age of 55.
This is one of a number of options for savers. In doing so, they pay no tax on the first 25% of these funds, but pay the normal rate of tax on the rest.