Think back to 2015; a pint of milk was 45p, “bank of mum and dad” entered the Oxford Dictionary, and 2-year variable rate mortgages were 2.80%*.
When the pensions freedoms legislation came into force in April 2015, it revolutionised retirement, placing unprecedented control in the hands of clients and fundamentally shifting how we approached retirement planning.
The intention was to give control and choice to defined contribution savers, enabling them to drive better outcomes and better meet their individual needs. But a decade of change has brought both opportunity and complexity.
The landscape has shifted
Before the pension freedoms, 90% of pension savings were used to purchase annuities. Immediately following the legislation, twice as many pots moved into drawdown than annuities and 53% of pots accessed were fully withdrawn.
More recently, we’ve seen the annuity market go from strength to strength. Alongside this, FCA data has revealed that advised clients are twice more likely to choose solutions that secure their long-term retirement income compared to non-advised clients.
Yet, many people are still making poor decisions. They are not accessing financial advice and are hindered by a low understanding of retirement options as well as having low trust in pensions. Paired with this, most will follow the path of least resistance and are also largely unaware of any behavioural biases they may be displaying.
Discover our new white paper
Our new white paper explores the impact of pension freedoms and how advisers can guide customers through today’s retirement landscape. From navigating longevity risk to understanding behavioural barriers and Open Market Option insights, we cover what matters most.
Through this paper, we want to provide valuable insights for customers, advisers, and policy makers as we navigate this next era of retirement planning. By understanding the evolving needs of retirees, embracing the opportunities presented by an open market, and considering the role of housing wealth in holistic retirement planning we can work together to ensure that customers have the tools and support they need to achieve their retirement goals.
You download our white paper now, here.
Source:
*https://www.mortgageable.co.uk/mortgages/history-of-mortgage-interest-rates
