- 43% of advisers believe COVID-19 and recent volatility has made their drawdown clients more demanding of their time
- Over two thirds of advisers (69%) say their clients are concerned about the impact of market volatility on their retirement plans
- Two guides published by Defaqto and Canada Life today will direct advisers and clients through the drawdown review process
A Canada Life survey has revealed that over two fifths of advisers are feeling the pinch as clients become more demanding of their time in light of recent COVID-19 driven market volatility. A majority of advisers also suggested their clients are concerned about the impact on their retirement planning.
In response to these concerns, Canada Life has partnered with Defaqto to create free Drawdown Review Guides** tailored for both customers and advisers. Drawdown reviews are a critical part of the advice process and, given recent significant market volatility, it may lead to some challenging conversations during these reviews.
The guides have been carefully designed to support the advice process and prepare clients for the review, ensuring any changes to clients attitude to risk is captured. They then explain the key steps that should be considered in every drawdown review to provide a clear evidence-based pathway forward and evidence of ongoing suitability and sustainability.
Andrew Tully, Technical director at Canada Life comments on why the guide is needed:
“It’s clear that the short and long-term impacts of COVID-19 are only now starting to be felt and understood. In recent months we have seen stock market volatility around the world with falls of up to 35% followed by a substantial rally shortly after, and the slashing of dividend payments by many businesses. This could easily be seen as a perfect storm for those in drawdown and it’s unsurprising that many may be feeling concerned.
“Clear communication is crucial and an annual review is an integral part of that process. Our guide, written in conjunction with Defaqto, aids the design of a robust and repeatable process which can help you demonstrate the right way forward for each of your drawdown clients.
“Advisers may also be starting to consider how to factor in any lasting changes of today’s ‘new normal’ such as whether investment weighting in commercial property should be altered or whether a property is still the reliable source of income it once was. We will never know what the future holds however by helping people make decisions for the right reasons you can help your clients enjoy tomorrow.”