As the retirement landscape grows more complex and demand for flexible income solutions rises, Brooks Macdonald’s newly launched Retirement Strategies could offer advisers a timely way to meet evolving client needs. With a suite of three distinct solutions, Bespoke, Tailored, and Modelled, designed to tackle key risks like sequencing, longevity, and inflation, the proposition aims to bring clarity and confidence to retirement income planning.
Retirement Income planning is more important than ever. According to the ONS, within the next 15 years the UK population aged 65 and over is projected to increase to nearly a quarter of our population. Yet, according to the FCA, only 9% of the UK population receive regulated financial advice.
Planning for retirement brings growing complexity, from the changing regulatory environment to the management of multiple pension pots and inheritance tax considerations. As advisers, you know that helping clients prepare for retirement goes beyond numbers, it’s about creating sustainable, flexible income strategies that adapt to their evolving needs and goals. A clear retirement strategy helps clients set realistic financial and lifestyle goals, respond to market and life changes and avoid depleting savings prematurely.
Hybrid solutions to meet clients’ evolving needs
Earlier in June, Brooks Macdonald launched its new Retirement Strategies, a comprehensive suite of investment solutions designed to help advisers meet the varied and evolving retirement income needs of their clients.
These strategies address the growing need for hybrid retirement products that combine sustainable income with growth while catering for different individual circumstances and levels of complexity.
Brooks Macdonald Retirement Strategies offers three solutions to cater for a range of client profiles:
- Bespoke: A highly personalised solution for clients who have more complex needs, require greater income flexibility, or have specific preferences on longer-term growth components of their portfolio.
- Tailored: A solution tailored to deliver set income requirements for clients whose needs are less complex, that can be addressed with one account for a lower management fee.
- Modelled: A model-based platform solution which provides a choice of platforms and withdrawal rates to suit clients’ income and risk requirements, while allowing advisers to maintain operational efficiency across their client bank by using their platform of choice.
Addressing the risks
Financial plans for clients in drawdown must address three key risks: sequencing, longevity, and inflation. Sequencing risk – the risk that the timing of withdrawals can negatively impact an investor’s overall return – is often the primary challenge. Addressing sequencing helps clients to stay invested for the long term and can improve their ability to manage other longevity and inflation-related risks.
The modelled strategy aims to provide security of income by actively managing these risks. It uniquely combines two strategies within a single account – one focused on the first seven years in retirement when the timing of withdrawals tends to have a greater impact on long-term returns, and another focused on growth for the longer term beyond year seven.
Brooks Macdonald’s modelled strategy meets strong client demand in a growing market driven by rising demand for flexible retirement solutions. The number of income drawdown plans is expected to increase by 20% over the next five years and 57% of Defined Contribution (DC) pension holders express strong interest for retirement options which combine shorter-term income planning with long-term investing[1].
Supporting you to help your clients
At Brooks Macdonald, we support advisers with the insights, tools, and expertise to deliver personalised retirement solutions. With Brooks Macdonald as your partner, you can benefit from our range of solutions, offering retirement income options for different segments of your client base and delivering personalised, expert-led retirement strategies.
Our Retirement Strategies gives financial advisers a robust and repeatable way of meeting the evolving needs of your clients, particularly as demand grows for hybrid products.
Click here to find out more about the Brooks Macdonald Retirement Strategies: bringing clarity, choice and confidence for you and your clients.
[1] Mintel, Annuities and Income Drawdown Report, December.
