The British pensions and retirement market has seen enormous change over the last five years. This change has been mainly driven by two factors: auto-enrolment and pension freedoms. So how might the retirement market look in another five years?
The pension freedoms policy has unlocked billions of pounds of savings, allowing retirees to make better use of their pension funds. It has resulted in a massive boost in flows through financial advisers, wealth managers and platforms.
At the end of 2016, there were £1.5trn assets in Occupational UK DB Schemes, according to TPR. At NextWealth, we estimate that there are nearly £400bn in assets in workplace DC schemes and that the figure will continue to rise rapidly in the next five years, driven in part by auto-enrolment. The Pensions Regulator reports that about 100,000 people transferred out of their defined-benefit pension in the year ending 31 March 2018.
But the FCA appears to have turned a cold shoulder to DB-to-DC pension transfers. Advisers who haven’t been dissuaded by the FCA’s increasingly hostile view of DB transfers may have been put off by rates demanded for PI cover.
The knock-on effects of pension freedoms are reshaping retail investing and financial advice. ??I am pleased to announce that NextWealth has joined forces with Richard Parkin (self-confessed pensions geek) to help asset managers, platforms, life cos and financial advisers understand how the retirement market will develop over the next five years.
We will consider the estimated volume and value of the DB transfer business, analyse approaches to advice in retirement and the existence of a centralised retirement proposition, offer a view on the future regulatory landscape, the impact of technology and emerging innovations.
We want to speak to financial advisers, platforms, life cos, trade associations and anyone up for a natter on how the retirement market might evolve. We especially want to hear from advisers on your approach to advice in drawdown and any changes you plan to make in your approach to DB pension transfers. Please do get in touch.
In other news, I will be at the Meeting of Minds Retirement event this week and I’m speaking at PIMS on 24-25 May. I am also speaking at FundForum on 11/12/13 June. Hope to catch up with you at one of those events
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