INSISTENT CLIENTS PUTTING PRESSURE ON ADVISERS

  • More than one in five say they’ve made recommendations they’re uncomfortable with since launch of pension freedoms

Advisers are becoming increasingly concerned about making retirement income recommendations they are uncomfortable with since the launch of pension freedoms, new research* from MetLife shows.

Its study found 22% of advisers were not comfortable with customers choosing not to follow their recommendations since pension freedoms increased flexibility over pension funds.

The worries about insistent clients are reflected in the study of advisers’ concerns in relation to the ongoing impact of pension freedoms – around 87% of those questioned said they were worried that increased flexibility over pension funds was leading to savers making mistakes.

Concern about clients running out of money came second only to concerns about consumers facing unnecessary tax bills – around 93% of advisers want more clarity on tax rules.

MetLife research** among retirement savers show there are grounds for concern – around 11% of those questioned said they planned to take all their pension savings as cash while 12% were considering turning final-salary scheme savings into cash.

Simon Massey, Wealth Management Director at MetLife UK said: “Advisers make recommendations and it is ultimately up to clients to decide what they want to do.

“It is still worrying that so many advisers have had cases since the launch of pension freedoms where they were uncomfortable with the recommendations they made.

“It highlights the desperate need for more innovation in retirement income solutions that can deliver the combination of certainty and flexibility that is so important following the launch of pension freedoms. Guarantees have a major role to play in delivering that.”

MetLife’s Retirement Portfolio, is specifically designed for pension freedoms, providing a choice of income and capital guarantees and its range of guaranteed retirement and savings solutions addresses the need for a guaranteed level of income for life in retirement and protection of capital against volatility.

The flexible guaranteed drawdown solution offers the potential for daily lock-ins of investment gains while enabling savers to start, stop and restart their income to suit their personal needs. Customers can choose from a range of investments to build a personalised retirement plan suited to the level of risk they are willing to take, while having the choice of a valuable guaranteed level of income for life or a guaranteed capital sum at retirement.  

MetLife’s guaranteed stocks and shares ISA offers a choice of income or capital guarantees, with savers who invest in the Secure Income Option able to take a guaranteed level of income for life from age 55, while customers who use the Secure Capital Option have the certainty of a guaranteed amount at the end of their chosen term.