A wave of over-55s are looking to use their newfound access to their pension savings to start a business - despite most small businesses failing to get off the ground.
According to new research from O2 Business, one in four over-55 respondents aspire to start a business and 'become their own boss'.
And Axa Wealth found that more than half of over-55s said they are thinking about using the new pension freedoms to found a business, with half of those saying they'd use their 25 per cent tax-free lump sum to do so.
Do you know when you will be able to retire? Read our pensions clinic on changes to the state pension.
STARTING A BUSINESS IS RISKY
But Axa's Adrian Lowcock warns people may be romanticising the notion of becoming a business owner, and could find themselves struggling financially if the business fails to reach escape velocity.
'With more choice and freedom inevitably comes more risk, and although small businesses are the backbone of Britain, most fail to make a profit and end up losing all their investors' money. For the majority of people it is not an appropriate use of their pension pot.
'You wouldn't want to risk your hard-earned pension money, so anyone considering investing in a small business needs to consider what the loss of their investment and retirement income would have on the quality of their investment.'
The research by O2 Business, however, claims that 70 per cent of businesses started by over-55s last longer than three years, while only 28 per cent of those set up by young people last that long.
Axa found that the largest sector in which over-55s aspired to become entrepreneurs was in healthcare (which could include sports massage, for example), with transport and travel coming second.
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