Prior to 2015, if you were about to draw your pension, then you didn't really have much choice of what you did with your pension pot. You were required to buy an annuity, which would transform your pension pot into a guaranteed income for life.
To be fair, savers did have a choice as to where they bought their annuity from, but most servers generally bought an annuity with their current pension provider, leading to many people getting a poor return on their savings.
Regardless of the return, for many people, an annuity wasn't a suitable product to fund their retirement, such as if they wanted to invest much of their pension pot into a small business for example.
In view of this, in April this year, George Osborne brought in dramatic new changes to the pensions industry by giving savers much more freedom as to what they could do with their pension pot once over the age of 55.
This week has seen economist and pension experts as well as a host of other financial commentators welcome these changes as these pension freedoms have produced a spending bonanza that has currently reached £1.3 billion.
Over 55s, as a consequence of the changes, now have the highest amount of disposable income amongst any age group, leaving them cash to spend on things such as cars, holidays and other high value purchases. Nearly 50% of over 55s said that they now did not struggle to fund lifestyle purchases, compared to 27% of 35 - 54 year olds. This is now providing a major boost to the economy and these pensions freedoms are providing an increase in Britain's economic recovery.
However, a word of warning against this spending bonanza has been uttered by Dr Ros Altmann, world renowned pensions expert and the government's pensions minister.
"It is entirely right that people should be allowed to take the money out rather than be forced into taking an annuity. But I would also encourage people not to be in a hurry to take the money out of their pensions if they don't have to."
She also advised that people should pay particular attention to their tax status and liabilities to ensure that they are not stung by high or unnecessary tax charges.
Perhaps the last word should be given to The Treasury who have implemented the changes. A spokesman for the department said:
"Our new pension reforms give people real freedom and choice over how they spend their hard-earned savings in retirement."