Expect the unexpected? Retirement planning in uncertain times For - - PowerPoint PPT Presentation
Expect the unexpected? Retirement planning in uncertain times For advisers only Not for use with retail customers Learning Objectives To be able to demonstrate an understanding of: Planning The suitability and implications from
For advisers only – Not for use with retail customers
Planning implications from Retirement Journeys and Pension Freedom ‘cohort’ research The suitability and regulatory challenges for drawdown advisers in uncertain markets
This presentation is for adviser use only and not for retail customers, and contains some forward thinking statements which should not be taken as fact. Information given is based on our current understanding, as at 01-09-2017, of current taxation, legislation and HMRC practice, all of which are liable to change and subject to an individual’s own circumstances. Terms and conditions of products are available on request. The level of charges may change in the future. For webex presentations, the event may be recorded for training purposes. No reproduction, copy, transmission or amendment of this presentation may be made without the written permission from Prudential. Prudential" is a trading name of The Prudential Assurance Company Limited. This name is also used by other companies within the Prudential Group. The Prudential Assurance Company Limited is registered in England and Wales. Registered
Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. The value of an investment may go down as well as up. Your clients may get back less than they have invested.
Any examples included are designed to represent a typical situation and are not related to any particular individual. They do not recommend that course of action. This presentation contains past performance information which is not a reliable indicator of future performance. Investments can go down as well as up. Clients may not get back what they put in.
400,000 £50bn Relatively affluent Other pensions DC wealth above average Access to SIPP or ID Annuity ID / Cash Not spending splurge! Source PLSA ‘Pension Freedoms – No more normal’ Jan 16
1.75m £164bn
Started to explore
Cash and ID popular
Limited ID experience Limited DB DC/Savings reliant
Risk exposure Some deferral possible
Source PLSA ‘Pension Freedoms – No more normal’ Jan 16
Underestimation of life expectancy Health concerns Core vs discretionary income Desire for legacy bequest Precautionary saving? LTC? Under-consumption as default? Financial health check at 70+? Flexibility then security of income
Source ILC Understanding Retirement Journeys Nov 2015
Source ILC Understanding Retirement Journeys Nov 2015
Fund Value at end of year
60 75
Client Age at start of year
91
Income (£) Source: Prudential retirement modeller
Starting income £18,192
This example represents a typical situation. It is not related to any particular individual. It does not recommend that course of action.
Fund Value at end of year
60 75
Client Age at start of year
91
Income (£)
State Pension
Source: Prudential retirement modeller
Starting income £24,852
This example represents a typical situation. It is not related to any particular individual. It does not recommend that course of action.
Source: FCA
‘The Story Of Advice’ Transfers Round 1 Other Aspects Transfers Round 2 CP 17/16 TVAS
Defined Benefit transfers Other aspects
Research and due diligence
Paradigm Support Material…
DB Transfer here? Annual review here!
The graph shows the FTSE100 Index from 14 December 2006 to 13 December 2016 . Source: FE Analytics
Drawdown here? Drawdown here? Annual review here! Annual review here! Percentage growth or loss
Draw from cash…? Natural income from fund…? Insurance/guarantees…? Smoothing…? Safe withdrawal rate…? Time the market…’buckets’?
Source of performance data: Financial Express (FE). Please remember that past performance is not a reliable indicator of future performance. The figures are intended only to demonstrate performance history of the fund over the period shown and include a representative fund charge of 0.65% pa. They take no account of product or advice
charges may impact the overall performance. The value of your client’s investment can go down as well as up and the amount your client gets back may be less than they put in. Performance is shown on a bid to bid price basis
Planning implications from Retirement Journeys and Pension Freedom ‘cohort’ research The suitability and regulatory challenges for drawdown advisers in uncertain markets