Deciding when to access your pension is one of the biggest financial decisions you’ll make, but not everyone gets it right.

Three in five retirees (61pc) who decided to withdraw tax-free cash from their retirement pots before last November’s Budget – some out of concern that rules would change overnight – regret doing so, according to wealth manager Quilter.

Rumours that the Government would announce sweeping changes to pension tax relief and the tax-free lump sum prompted hundreds of thousands of savers to access their pot sooner than planned.

Jon Greer, head of retirement policy at Quilter, said: “Allowing rumours to fill the gap for weeks or months risks undermining confidence in plans that may have been laid for decades – and leading to poorer outcomes.”

If you regret taking your lump sum, we’ve asked financial experts for other sensible ways to use the cash.

Pay it back into your pension – but tread carefully

If you’re still working and have sufficient earnings, you may be wondering whether to pay some – or all – of the money back into a pension.

Rebecca O’Connor, director of public affairs at PensionBee, said: “You need to be aware of HMRC’s pension recycling rules, which restrict this in specific circumstances. It’s worth checking whether these apply before assuming this route is straightforward.”

Make a wrong move and you could end up getting penalised.

Helen Morrissey, head of retirement analysis at Hargreaves Lansdown, said: “The rules are there to prevent people from reinvesting their tax-free cash into their pension to get extra tax relief. There are very specific rules around what counts as recycling, and if all the conditions are met, you could face a charge.”

You might fall foul of pension recycling rules if all the following conditions are met:

A tax-free lump sum is taken.This tax-free lump sum exceeds £7,500 (this includes any other tax-free lump sum taken in the past 12 months).Contributions into pensions are significantly higher than what’s expected following the lump sum being taken, whether paid by you, your employer, or a third party (the recycling rules take into account contributions paid in the tax year in which the tax-free lump sum is taken, as well as two tax years either side of this).The value of the contribution increase is more than 30pc of the tax-free lump sum taken.HMRC can show that recycling was “planned by the member” to get additional tax relief; the onus is on HMRC to evidence this.

In short, if contributions significantly increase at or around the time of taking a lump sum, HMRC may well suspect recycling and investigate further.