New research has shown that advisers are increasingly recommending ISAs as part of retirement planning as rules on pension flexibility and lifetime allowances change.
A survey from MetLife revealed that amongst the retirement specialists questioned, nearly 60% said that they have changed recommendations to make more use of ISAs in retirement planning in the past. However, the survey also revealed that clients remain concerned about the impact of stock market volatility on ISA investments. Advisers said that around 24% are worried that a stock market crash in the run-up to retirement will erode savings.
Some 25% of advisers say clients are also concerned about investing in ISAs ahead of pensions due to concerns about losing capital in the run-up to retirement.
Wealth Management Director of MetLife UK Simon Massey said: “The £20 billion increase in ISA investments in the last tax year highlights how advisers are right to recognise their importance in retirement planning, which will only grow once the new lifetime allowance comes into effect.
“But the risks of ISA investment in stocks and shares are being demonstrated by the ongoing stock market volatility with the FTSE suffering along with all global markets, there needs to be solutions which can help combine certainty with flexibility.
“Risk proofing retirement remains one of the biggest challenges following the launch of pension freedoms and guaranteed solutions have a major role to play in meeting growing demand.”
