Amid George Osborne’s widely reported shelving of a possible pensions ISA, 18% of consumers polled by The Share Centre said they were planning to withdraw their nest egg for use in an ISA – an increase of 6% on last year.

The research of over 1,500 people also found that 19% of investors have already been choosing a stocks and shares ISA to fund retirement over a private pension. This indicates that consumers are yearning for increased flexibility and access to their long-term savings.

Since pension freedoms gave retirees the opportunity to access cash tied up in a pension, as opposed to purchasing an annuity, The Share Centre has seen an increase of 9.2% in ISA inflows year on year.

Richard Stone, chief executive of The Share Centre, said: “Pension changes and tax overhauls can seem incredibly daunting, but people clearly favour the flexibility an ISA can offer.

“When it comes to the apparent U-turn on the ‘pensions ISA’, it’s easy to see why it attracted criticism, with many viewing it as yet another complicated change to retirement policy. But with auto-enrolment now being made mandatory across the UK, there is less need for personal pensions as a savings vehicle.

“Whatever happens, what’s more important than anything is ensuring that the incentive to save for the long-term is protected, and people don’t shy away from it.

“This is particularly true when it comes to investing: people can be scared off altogether.”