Xafinity: Advisers lack retirement knowledge
The increasing variety of options for income in retirement presents a rich vein for advisers to mine, Xafinity Paymaster’s Brian Please argues.
Advisers could be “missing a trick” by not devoting more time to advising retirees on their options for income after retirement, Brian Please, business development manager for payment company Xafinity Paymaster, told FTAdviser.
According to Mr Please, advisers often refer clients to a specialist adviser when it comes time for them to make a plan for retirement.
Mr Please said: “Advisers don’t understand Sipps [self invested personal pension plans] and drawdown well enough to advise. There are some advisers who do know their stuff but most advisers don’t do enough advice on retirement to really understand why a customer would want a drawdown rather than an annuity.”
However, he believes this is particularly important as this market presents an “ideal opportunity” for advisers.
Mr Please said: “It’s complex and it’s so important as it has a more fundamental impact on an individual’s financial future than anything else. It’s a huge industry to become competent in.”
One reason Mr Please gave for why retirees may wish to avoid an annuity is the proliferation of enhanced annuities.
According to Mr Please, as more people qualify for enhanced annuities the worse off non-enhanced annuity buyers will be.
Another unintended consequence if enhanced annuities take off will be “over-disclosures” such as people exaggerating their unhealthy lifestyles or health problems to get more in retirement, Mr Please said.