Dominic Grinstead, managing director of MetLife UK, anticipates one evolution in the market is that many clients will now review their arrangements on a regular basis, as often as annually, and their decisions will be driven by their needs, tax-planning and investment conditions.
As retirement becomes more of a process rather than a single event in line with changing working patterns, Mr Grinstead says it is natural that decisions will be made at various times.
Iincreasing numbers are working later in life so can retire in stages, says Stephen Lowe, group external affairs and customer insight director at Just Retirement, while others are choosing to use pension money to clear debts.
According to Mr Lowe the important thing is that people assess their assets and make a plan, ideally helped by a professional planner, to cover their income needs, inheritance and long-term care issues.
John Perks, managing director of LV Retirement Solutions, says many retirees may demand a solution that affords them the opportunity to switch to an alternative product as their circumstances change, for example if their health worsens.
However Mr Perks says there will be clients that want to make a one off retirement income decision such as taking their money as a lump sum or locking into a lifetime annuity that offers them potential future growth.
He says: “It is important that clients are encouraged to consider all the options available to them and select the solution that best suits their financial circumstances and meets their needs.”
Richard Williams, director of The Annuity Bureau from JLT, says whether to make a one-off retirement income decision or stagger choices is dependent on the needs and aspirations of your client.
For example, the fact remains that typically people who stop working, which is a one-off decision, need to replace lost wages.
Mr Williams says many will not have the luxury of staggering their choices as they will need the income with immediate effect.
Others who can sit back and contemplate their choices should wait to see what new innovative products are produced by the providers that may suit them more than the current ones, he adds.
Mr Williams says: “You may also get some that are in a half-way house situation that need some money now, i.e. tax-free cash but can defer taking any income, they can make use of the new 12-month products or a drawdown contract with nil income if more appropriate.”
