New research has revealed that over half of IFAs (56%) believe that multi asset funds are the most suitable for people post retirement looking to generate an income over a 20-year retirement.
The findings come from Baring Asset Management and also conclude that:
- further 54% believe that pension freedoms will mean that multi asset income products will become more significant for people post-retirement;
- over a quarter (28%) believe that a single multi asset income fund is more suitable than multiple income funds across asset classes for people post-retirement looking to draw a retirement income;
- vast majority (87%) say charges are the most important factor when assessing the suitability of a drawdown retirement income fund for generating a post retirement income.
Barings sounded out 106 UK financial advisers. The research also showed that with the rise of auto-enrolment, multi asset funds ranked as the most popular default funds for non-retired people approaching retirement, cited by 71% of IFAs. What’s more, two in five (40%) IFAs suggested it was multi-manager funds, whilst 20% said it was diversified growth funds.
Head of Multi Asset Income at Barings Sonja Laud said: “As people live longer, being able to drawdown income post retirement becomes more and more important. Our research has clearly demonstrated the value that IFAs place on multi asset funds and in particular the levels of income they can provide post retirement.
“The Baring Multi Asset Income Fund will be managed with the aim of preserving capital through our strong multi asset skillset. Unlike many income funds, a unique feature of this fund will be monthly income payments with a high income target. Barings has been running multi asset portfolios for many years and has been at the forefront of multi asset investing and innovation to create solutions to suit a variety of client needs.”
