Two years on, how has pension freedoms affected portfolios?

However, significance remains for the April 6 date for other reasons. This year marked the two-year anniversary of the George Osborne-era pension freedoms which, I think it is safe to say, dramatically altered the savings and investment environment.

On the legislative side – as was noted by various media outlets last week discussing how the reforms have been embedded – there is still some work to be done. There remains little help for savers likely to deplete capital, ending up with no retirement income. Providers such as Nest will continue working on default schemes to avoid this, but the risk remains for non-advised clients.

The implications of pension freedoms on a client’s asset allocation still need time to fruitTaha Lokhandwala

That being said, it was a liberal policy designed to give people that choice.

The pensions savings and retirement income industry has almost adapted, quicker than I thought it would in 2014, as I sat in awe watching George Osborne and then quickly picking up the phone to understand what this meant. I was an institutional pensions journalist at the time. But what still isn’t fully clear, and definitely won’t be for some time, is what this means for the investment industry and advisers’ asset allocation strategies. On a strategic level, a client’s asset allocation should be dictated by risk tolerance, age and income requirement. But tax relief and product type play a big part, of course.

Trends have begun forming. Investment Adviser reported last year that a sea change was occurring in how advisers managed client money, with personal pensions becoming the favoured vehicle at the expense of Isas.

This trend has continued. In what was a quiet year for sales generally in 2016, pensions still brought in £4.3bn from the five biggest platforms, overshadowing the £1.4bn for Isas. I’m sure few of you need reminding that until 2015, the favouritism for Isas was clear.

But these trends still don’t tell us what happens next. The implications of pension freedoms on a client’s asset allocation still need time to fruit, and questions still need answering. For example, as a client ages does one effectively split asset allocation by product? Will strategies funnelled via pensions have a higher allocation to equities than Isas because they’re more long term? Or will the Sipp still be used for a client’s 25 per cent tax-free allowance taken in cash among their wider pensions savings?

Then there are other considerations now. With the Isa tax-free allowance now £20,000, will we see a slowing down in the growth of Sipp sales? For younger clients, where does the Lifetime Isa fit in?

Last year, the Investment Association – which provided the sales figures – told Investment Adviser it would look to see how a shift from Isas to personal pensions might change the popularity of investment strategies. But we’re now two years in and I would suspect everyone is none the wiser.

The new tax year might bring round a refreshing of tax reliefs – but it has also brought a whole new set of questions advisers need to consider.

Taha Lokhandwala is news editor at Investment Adviser