Almost half (47 per cent) of financial advisers felt that demand for retirement advice increased more than usual due to the pandemic, Aegon and Next Wealth’s latest retirement advice report has found.

Advisers reported that changing attitudes to work were driving demand as clients reassess priorities.

The latest data showed demand for retirement advice had continued to increase during the second year of the pandemic, with a 7 percentage point rise in advisers reporting an increase in demand from the previous year (40 per cent to 47 per cent).

Furthermore, 51 per cent of advisers said there has been an increase in clients retiring early.

This is reflected in official figures over the last two years showing a rise in the number of older workers leaving employment, a reversal of pre-pandemic trends.

Difficulties around new client acquisition was the biggest business impact that advisers faced during the first year of the pandemic, according to the report, as face-to-face meetings were seen as important for first-time clients, and these were restricted within the social mixing rules.

However, this year’s research shows the relaxing of social distancing rules and increased confidence in doing business digitally has made it easier for advisers.

The latest data showed less than a third (32 per cent) of advisers said that it was more difficult to acquire new clients during the pandemic, compared to 57 per cent from the first year of the pandemic.

Aegon chief distribution officer, Ronnie Taylor, commented: “Demand for retirement advice has been increasing since the introduction of the pension freedoms, and the pandemic has further demonstrated the value of advice in this area.

“Over the last two years, individuals have increasingly reassessed priorities and long-term plans and have been prompted to focus more on health and longevity.

“The research points towards an increase in early retirement during the pandemic.

“Advisers are well placed to support clients through this and manage a sustainable income throughout retirement.

“We’ve become used to a volatile stock market in recent years and the research shows there is growing sophistication in the use of retirement planning tools to support safe withdrawal strategies.

“The uncertainty around the economic outlook with rising interest rates and high inflation means the robustness of financial plans is expected to be tested further.

“The transaction to remote meetings and the huge acceleration of digital processes has opened up new opportunities for advisers as an alternative means of communication with clients.

“However, face-to-face meetings remain an important part of developing new relationships so it’s understandable the relaxing of social mixing restrictions has made client acquisition easier.”

Next Wealth managing director, Heather Hopkins, added: “The Covid pandemic has fuelled demand for retirement planning advice as people re-evaluate priorities and look at options to retire early.

“Half of financial advisers told is that they have seen an increase in the number of clients looking to retire early through the pandemic.

“The complexity of this decision underscores the value of professional financial advice. We look forward to continuing to chart the course of retirement in the UK.”

Share Story: