10 years of pension freedoms
Guiding choices, empowering outcomes in retirement
A decade of change
Think back to 2015; a pint of milk was 45p, “bank of mum and dad” entered the Oxford Dictionary, and 2-year variable rate mortgages were 2.80%*.
When the pensions freedoms legislation came into force in April 2015, it revolutionised retirement, placing unprecedented control in the hands of clients and fundamentally shifting how we approached retirement planning.
The intention was to give control and choice to defined contribution savers, enabling them to drive better outcomes and better meet their individual needs. But a decade of change has brought both opportunity and complexity.
The landscape has shifted
Before the pension freedoms, 90% of pension savings were used to purchase annuities. Immediately following the legislation, twice as many pots moved into drawdown than annuities and 53% of pots accessed were fully withdrawn.
More recently, we've seen the annuity market go from strength to strength. Alongside this, FCA data has revealed that advised clients are twice more likely to choose solutions that secure their long-term retirement income compared to non-advised clients.
Yet, many people are still making poor decisions. They are not accessing financial advice and are hindered by a low understanding of retirement options as well as having low trust in pensions. Paired with this, most will follow the path of least resistance and are also largely unaware of any behavioural biases they may be displaying.
Expert navigation is needed now more than ever.
Our new whitepaper explores a decade of change
“Ten years ago, pension freedoms revolutionised the retirement landscape, empowering customers with unprecedented control over their retirement savings.
This landmark legislation undoubtedly brought greater choice and flexibility, but it also introduced complexity, additional risk and the potential for unintended consequences.
This white paper explores the evolving landscape of retirement planning, examining the challenges and opportunities presented by pension freedoms. It delves into the critical role of financial advice, the significance of longevity risk, and the importance of an open market option in delivering sustainable and fulfilling retirement outcomes.
Through this white paper, we want to provide valuable insights for customers and advisers as we navigate this next era of retirement planning. By understanding the evolving needs of retirees, embracing the opportunities presented by an open market and considering the role of housing wealth in holistic retirement planning we can work together to ensure that customers have the tools and support they need to achieve their retirement goals.”
Nick Flynn, Retirement Income Director at Canada Life
Watch our CPD qualifying webinar
Now availale on demand
Ten years ago, pension freedoms transformed how we think about retirement, putting consumers in the driving seat of their retirement savings.
At Canada Life, we recognise that advisers providing consumers with informed choices, underpinned by expert advice, is key to unlocking positive retirement outcomes. That's why we're hosting this webinar, which has been designed with you in mind.
One in eight prospective annuity buyers unwilling to shop around despite potential income gains
New research by Canada Life has revealed that one in eight people intending to purchase an annuity would not consider switching from their existing pension provider to another supplier, even if they could potentially gain additional retirement income.
From complexity to clarity: your expertise makes the difference
As an adviser, you're the key to unlocking flexible retirement plans. You translate complex information into clear, actionable strategies, ensuring your clients make informed decisions that align with their individual goals.
Our solutions are designed to support you and to meet the evolving needs of your clients at every stage of retirement. You can find out more here:
Lifetime Annuities
A secure, regular income for life. Our lifetime annuity uses the money saved in your pension plan to give you a guaranteed, regular income for life.
Fixed Term Income Plans
Plan ahead with confidence. Get a regular, guaranteed income between 1 to 20 years with our Fixed Term Income Plan.
Purchase Life Annuities
A tax-efficient income for life or a specified term. This annuity lets you invest a cash lump sum in return for a regular, guaranteed, tax-efficient income.
Home Finance
Unlock tax-free cash from your property with our award-winning Home Finance product range – all without needing to sell your home.
The reality of modern retirement: Life100+ and beyond
Our Life100+ research reveals a profound shift in retirement. The "active" phase is extending, demanding longer-term planning and a greater emphasis on peace of mind and empowerment. Your clients are asking: "What can I expect?" Can you provide the answers?
Learn more about the key roles intergenerational relationships and financial advice will play as we plan for a longer later life.
**https://www.fca.org.uk/data/retirement-income-market-data-2023-24
***https://www.canadalife.co.uk/news/silver-lining-from-ongoing-gilt-market-volatility-for-annuity-customers/
Disclaimer:
Canada Life Limited, registered in England and Wales no. 973271. Registered office: Canada Life Place, Potters Bar, Hertfordshire EN6 5BA.
Canada Life Limited is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority.
Stonehaven UK Limited, trading as Canada Life, registered in England and Wales no. 05487702. Registered office: Canada Life Place, Potters Bar, Hertfordshire EN6 5BA.
Stonehaven UK Limited is authorised and regulated by the Financial Conduct Authority.
Canada Life and design are trademarks of The Canada Life Assurance Company.