Retirement account Bill

From bucket list to set list

What if your client has a lifelong dream to fulfil?

Bill has always wanted to go on tour with his band, but it was never the right time. Now he’s thinking about his retirement and how he could turn this dream into a reality. Here’s how The Retirement Account can help.

In this scenario we will show you how you can:

  • Simplify your clients’ pension provision while giving them maximum flexibility and income guarantees
  • Increase the chance of your client’s pension savings lasting beyond 30 years
  • Ensure they have one income payment each month, one P60 each year, one annual statement, and one firm to deal with.
Call Centre

Contact Us

Talk to one of our Account Managers to find out more

0203 510 6708

Or sign up for a consultation with your local account manager and future events and CPD learning.


Sign up

Getting started - consolidating his pension

Bill consolidates his pensions in The Retirement Account and uses some of his tax-free cash to buy a van and equipment. He is then able to use the remaining funds to provide a flexible drawdown income to accommodate his changing money needs while on tour.

3 pots into 1

Doing this gives Bill a clearer view of his finances, potentially lower charges over the life of his retirement, and only one policy and one income payment to keep an eye on. But how does this benefit Bill and his goal of touring with his band?


Managing his money for now and the future

Once Bill has taken 25% of his pot as tax-free cash to buy his new van, he can then invest the rest to provide the potential for further growth and a monthly income.


With a long and fruitful retirement ahead of him, it’s important Bill doesn’t run out of money, so his adviser must help him invest wisely.

The Canada Life 3-5-7 model has shown that by investing in the right combination of risk profiled funds to create an overall risk profile of 5, you can increase the chances of your client’s money lasting 30 years.

The 3-5-7 model invests a third of your client’s pension pot in risk profile 3, a third in risk profile 5 and a third in risk profile 7 (which carries the greatest amount of investment risk and is therefore not always included in a client’s retirement portfolio). Income is taken from the risk profile 3 fund with the lowest volatility. The portfolio is then rebalanced at least quarterly, in order to maintain the 33% split between 3, 5 & 7.

Using this ‘3-5-7’ strategy, you increase the likelihood of your client’s money lasting 30 years because they have increased protection against sequencing risk and volatility drag, whilst maintaining the same overall risk rating.

In rising markets, rebalancing means the amount invested in the risk profile 3 fund is likely to be ‘topped up’ by better performance from the higher volatility 5 & 7 risk-profiled funds.

In a downturn, the lower volatility risk-profiled 3 fund unit price is likely to fall less than the unit price of the more volatile risk profiled funds in 5 & 7, and because income is taken only from 3, the effect of pound cost ravaging is reduced.


And then the unexpected happens

At the age of 67, Bill is forced to retire from his band due to ill health. Bill starts to think about how he can prepare for his uncertain future and protect his family.

State pension

At age 67, Bill starts receiving his state pension and he wants to top that up with an additional guaranteed income to ensure his essential living expenses are covered.

The Retirement Account enables Bill to do just that, but with the added flexibility of taking that guaranteed income only when he needs it.

An annuity within a drawdown wrapper

Bill uses some of his remaining drawdown pot to purchase an annuity based on his age and health, providing him with a guaranteed income. He builds in a 20-year income guarantee to protect his wife, Maxine, should he pass away.

The Retirement Account enables Bill to reduce or stop the annuity income he is receiving should his circumstances change. Any income not taken will build up in the drawdown pot and can be withdrawn later.

If Bill passes away, a beneficiary drawdown account will be set up for Maxine to receive the ongoing instalments of the guarantee. Alternatively, she can commute this for a lump sum.

The remaining drawdown benefits will also be paid into the beneficiary drawdown account. This will allow the money to be retained in the tax-efficient pension wrapper and taken out in a tax-controlled manner.

The remaining drawdown pot

The remaining drawdown pot remains invested. But, as Bill is now receiving a guaranteed income from the annuity element and his state pension, he reduces the income he is receiving from the drawdown element.

His state pension increases in line with the triple lock, but his annuity is on a level basis. However, Bill expects the funds within the invested pot to grow and be available to top up his income if needed, if for example, the rising cost of living requires him to increase his income. Or he has the option to buy a further tranche of guaranteed income in the future.

Even though Bill is receiving income from the annuity element and from drawdown, there is one cumulative payment into his bank account each month. There is one P60 each year, one annual statement, and one firm to deal with.

As you can see from the above scenario, our flexible Retirement Account is more than a one-size fits all approach to retirement. With our retirement solution you can prepare your client’s for a number of eventualities and help them achieve their retirement goals and aspirations.



Get the full personal touch

Call us on

0203 510 6708

Or sign up for a consultation with your local account manager and future events and CPD learning.

Sign up
Website Desktop

Defaqto Report


Get our practical CPD qualifying guide to pension consolidation

Read the report
Shopping List

Elizabeth's story

Discover how a lifetime annuity while investing in a diversified monthly income fund can help your clients’

Find out more

*For Professional Adviser use only. Persons portrayed in the case studies are not based on real people and are for illustrative purposes only and may not cover all considerations relating to your clients. This should not be treated as advice and independent taxation and or legal advice should be sought.