Income drawdown and investment advice have topped the list of client needs after the pension freedoms came in, a provider’s research has revealed.
Findings from a 250-strong panel of advisers, surveyed by life and pension provider Aegon UK, revealed for the majority of advisers, pension freedoms have been their key client issue over the last year.
Some 61 per cent of respondents said the pension freedom changes were the top issue they had been dealing with over the last year, followed by investment planning at 44 per cent and inheritance tax planning at 22 per cent.
When it comes to the issues advisers are covering tied to pension freedoms, investment advice regarding income drawdown topped the list of queries.
This was followed by advice on whether to give up safeguarded benefits in order to gain access to pension freedoms, whether to opt for a guaranteed income such as guaranteed drawdown or an annuity, and how and when to make additional pension contributions.
Steven Cameron, regulatory strategy director at Aegon UK, said: “The pension freedoms have presented those at retirement with welcome new choices on how to access their savings, but they’ve come hand in hand with greater complexity.
“Some decisions like transferring from a defined benefit scheme, can only be made with professional financial advice.
“Others such as choosing between guaranteed drawdown and an annuity, or deciding where to invest assets are important decisions, can also have huge impacts on people’s retirement income and should be supported by the insight that professional advice provides.”
He mentioned that, with HM Treasury due to announce its initial conclusions from the Financial Advice Market Review (FAMR), which closed to consultation on 22 December and received more than 290 responses, the industry had “a real opportunity to find ways of extending valuable advice to a wider range of customers grappling with retirement choices”.
The Financial Advice Market Review is exploring ways to bring advice back to the mass market.
Common issues clients are raising regarding the pension freedoms: | |
Investment advice regarding income drawdown | 48% |
Advice on whether to give up safeguarded benefits in order to access pension freedoms | 38% |
Whether to opt for a guaranteed income such as guaranteed drawdown or annuity | 35% |
How and when to make additional pension contributions | 26% |
When they should access their pension savings | 17% |
Whether to take all their pension savings as cash | 11% |
Source: Aegon
