OverviewDrawdown has largely been acknowledged as the ‘winner’ in terms of product since the introduction of pension freedoms. However, as revealed in AKG’s latest industry research paper, entitled ‘Ten Years of Freedoms – Lessons, Gaps, and the Road Ahead’, this may now be changing. Here I look at some of the key findings from the paper, particularly in relation to the outlook for retirement solutions.
When advisers were asked what type of products they see as being the most used for clients in 2025/26, the top two types selected by respondents to the survey were products combining annuity and drawdown capabilities (70%) and Guaranteed Lifetime Income (66%). However, standalone Income Drawdown was still viewed as a popular product with 47% selecting this option.
When it comes to investment solutions, and perhaps mirroring the appetite seen for products, there was support amongst advisers for guaranteed income from within a drawdown account (57%). In the investment space, arguably the most competitive area in the mainstream market in recent years has been around the development and distribution of Managed Portfolio Services (MPS) and so, unsurprisingly, there is adviser support (38%) for these too.
There is also support for Bucketed/Multiple Investment Strategies (33%) while on the non-invested side, and symptomatic of client nervousness around market exposure, there was also support for cash/deposit accounts (26%).
Commenting on the findings within the paper, Paul Richards of Fidelity Adviser Solutions said, “Guaranteed lifetime income products and lower-volatility growth options can work together to help support better client outcomes. For example, providing a guaranteed income solution can ensure clients don’t run out of money while smoothed pension funds can help provide growth while mitigating some of the day-to-day market volatility and sequencing risk.”
Paul also commented, “Platforms, with their comprehensive package of solutions and wrappers, are exceptionally well-placed to support advisers and their clients through the whole retirement planning journey – both pre- and post-retirement. Not only do they provide clients with choice and value for money, advice firms stand to benefit as well through increased efficiencies and complementary platform services.”
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