British retirees are almost twice as likely as the younger generation to buy a brand new set of wheels, new industry research reveals.

A survey by AA Personal Loans showed that of the 7.5 million cars expected to change hands over the next 12 months, new cars will be bought by more than four in ten over 50-year-olds compared with less than a quarter of those under 50.

For the 21 per cent of British drivers set to buy a new vehicle over the coming months, 30 per cent will go for something brand new and 65 per cent will opt for second hand.

Nearly three quarter of younger adults who are planning to pick up a new car in the next year will buy second hand but only 50 per cent of over 50-year-olds are considering buying second hand – but it may not be the most economical option according to the AA.

"Although buying a brand new car offers the peace of mind that it has a full guarantee and manufacturer backup, choosing second hand can be a financially savvy decision," said Lloyd East, general manager of AA Personal Loans.

"The value of a car can depreciate by as much as 30 per cent within the first year after purchase. As a general rule, this rate of depreciation will halve to 15 per cent over the second and third years after purchase before levelling out."