Advice requests from those nearing retirement have been the third most common since Covid-19, making up 40 per cent of requests received by financial advisers, research by Aegon has found.

According to the company, reviewing drawdown investments and withdrawal rates was the fourth most common, making up 36 per cent of all requests received since the pandemic, and was closely followed by a review of investment asset allocation, which made up almost a third (31 per cent) of requests.

The findings follow research by Canada Life, which revealed that 69 per cent of financial advisers’ clients were concerned about the impact of coronavirus-driven market volatility on their retirement plans, whilst almost half (43 per cent) stated that their drawdown clients in particular had become more demanding.

Aegon’s research found that advice for those in the decumulation phase was the sixth most common form of request, making up 30 per cent of advice received since the pandemic.

Other common requests included assessing the ability to retire in light of market volatility, which made up over a quarter (28 per cent) of requests, and accessing pension freedoms, which made up just over a fifth (22 per cent) of advice requests.

Previous industry research has suggested that the pandemic will have a significant impact on retirement savings, with research by Co-op showing that almost a fifth of those over 50 expect the pandemic to impact their retirement plans.

Aegon found that a review of the possibility of defined benefit (DB) to defined contribution (DC) pension transfer was also relatively common during the period, making up 12 per cent of advice requests.

Aegon pensions director, Steven Cameron, emphasised that the current market volatility has prompted some individuals to look for investment opportunities, with those in the accumulation phase perhaps looking for opportunities to invest while share prices are low.

However, he added that for those with shorter time horizons, the pandemic may have reduced their risk appetite as they become more cautious in their investment choices.

Indeed, the company’s survey revealed that 31 per cent of advisers felt that their clients have become more fearful and reluctant to invest in the medium term.

More broadly, the company found that 31 per cent of financial advisers had seen an increase in client enquiries since the coronavirus outbreak began, despite recent research by the Association of British Insurers revealing a ‘dramatic decrease’ in member’s enquiring about and accessing their pension during the lockdown.

Commenting on the findings, Cameron explained: “There are lots of reasons why people seek financial advice and demand is often driven by a change in personal circumstances or influences from the external environment. For many, the coronavirus pandemic ticks both these boxes.

“Stock market turbulence following the onset of the coronavirus has no doubt been concerning for individuals, and with some facing disruption to employment, advisers can play a hugely important role in navigating clients through the issues and providing real value in the crisis.”

He added: “Without access to advice, there’s a risk people will take panic action that might not be in their best interests and could do significant long-term harm, particularly at important life stages such as retirement.

“While the coronavirus is first and foremost a health crisis, it is also having significant implications on personal finances and the economy. Demand for advice will inevitably remain high as the market reacts to the economic fallout from this global pandemic.”

Share Story: