Some 40 per cent of retiring clients’ pension assets are invested in multi-asset strategies, research from Aegon has revealed.
The research, which collated the views of 200 UK financial advisers, found that 31 per cent of advisers say their clients are choosing to retire later than they had initially planned.
When asked to identify the challenges faced by their retiring clients, advisers indicated that running out of money in retirement was the number one fear, mentioned by 77 per cent of advisers.
Difficulty when planning how much income they may need in retirement was second among common concerns, with 63 per cent of advisers saying clients felt this way.
Aegon UK investment proposition managing director, Lorna Blyth, said: “Given the economic challenges of the past few years, more people taking the decision to earn for longer and retire later shouldn’t come as a huge surprise.
“However, as we’ll explore in more detail in the upcoming second edition of our Second 50 report, it’s important that both clients and advisers recognise that stopping working at a later date, but living longer on average, doesn’t necessarily mean fewer years of retirement to fund and plan for.
“When it comes to building pension assets, the flexibility and risk-related options afforded b multi-asset strategies could be incredibly valuable for a growing number of clients who are adopting new patterns of work and retirement.
“It’s understandable that advisers continue to make use of them in the best interests of their clients, despite annuities becoming more attractive during the recent economic challenges.”
In terms of investment strategy, advisers say that 40 per cent of their retiring clients’ pension assets are invested in multi-asset strategies - the most popular investment strategy by a considerable margin.
Equity growth was the second-most popular strategy, with 15 per cent of retiring clients’ pension assets.
This was followed by equity income and fixed income, both at 11 per cent of retiring clients’ pension assets.
Despite favourable rates and the stability they can offer in a challenging economic environment, only 10 per cent of retired clients’ pension assets are invested in annuities - the fifth most popular option.
tom.dunstan@ft.com
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