Head vs heart, how would you spend £20,000?

Almost everyone in the UK would like to travel and see the world if they suddenly came into money.

That is the result of a new study by Prudential, that examined what our top priorities would be if we suddenly were handed £20,000.

But far from being a nation of dreamers and drifters, choosing to cut loose and sail away if given the means, the majority of people would spend most of such a windfall sensibly.

"We all have dreams no matter what our age, and it seems that the common aspiration for all age groups is to travel. But as people get older they find it more difficult to turn these dreams into reality," said Ali Crossley, director for lifetime mortgages, Prudential UK.

"Priorities change, and if money is tight, then the necessities of building the home and supporting the family outweigh the dream of travel."

Prudential's research found that, while always in the top four priorities, world travel was never the number-one spending choice for any age group in the UK.

Sixteen to 24-year-olds most often chose to spend the money on a new car; 25 to 55-year-olds would most likely improve their homes with a £20,000 windfall; while older groups say they would spend the money on their children and grandchildren first.

But while one 16 to 24-year-old in five thinks they will be able to head out travelling within five years, 41 per cent of 45 to 54-year-olds do not think they will be able to chuck in the rat race and head overseas for more than a decade.

As we grow older, we also lose hope that our ambitions will ever be fulfilled: three quarters of over-55s have unfulfilled ambitions with 42 per cent believing they will never live these out.

But Prudential's Mr Crossley points out that there is a way that older people can realise at least some of their dreams.

"What is upsetting is that nearly half of the over-55s questioned think that they will now never be able to live out their dreams and they cite money as the reason," he said.

"But what many of these people don’t realise is that there is another source of income that they can turn to – their property. With the recent house price rises, there is £693 billion tied up in equity. This money could be released using a lifetime mortgage."

Top priorities for spending £20,000 for 16 to 24-year-olds
New car (22 per cent)
World travel (20 per cent)
Study (17 per cent)
Home improvements (16 per cent)

Top priorities for spending £20,000 for 25 to 34-year-olds
Home improvements (23 per cent)
World travel (19 per cent)
Children (16 per cent)
Supplement income (15 per cent)

Top priorities for spending £20,000 for 35 to 44-year-olds
Home improvements (41 per cent)
Children (17 per cent)
World travel (13 per cent)
Supplement income (11 per cent)

Top priorities for spending £20,000 for 45 to 54-year-olds
Home improvements (36 per cent)
World travel (17 per cent)
Children (16 per cent)
New car (13 per cent)

Top priorities for spending £20,000 for 55 to 64-year-olds
Children/ grandchildren (33 per cent)
World travel (16 per cent)
Home improvements (15 per cent)
Supplement income (13 per cent)

Top priorities for spending £20,000 for over-65s
Children/ grandchildren (48 per cent)
Supplement income (15 per cent)
Home improvements (15 per cent)
World travel (11 per cent)