More specialist financial advice is needed for Brits who are pushing back their retirement plans to an age when they are less likely to be healthy.
Research from the London Institute of Banking and Finance found a majority of workers in the UK have failed to save enough to retire and are planning to push back quitting work by up to seven years.
Healthy life expectancy in England is 63.3 for women and 63.9 for men meaning approximately 16-20 years of potential poor health post-retirement, assuming they retire at state pension age.
LIBF managing director for corporate and professional qualifications Brian Wilkinson says: “For a long time most thought that in your 50s financial planning was ‘done and dusted’ – you got your pension, you’d paid off your mortgage. But that’s not the case anymore. Financial planning now starts at 50.”
Advisers will be vital to making comprehensive plans for those potentially spending up to seven years still in work but not completely healthy.
Wilkinson says: “A lot of the advice burden will fall on advisers. They’ll often need to have what can be complex and difficult conversations, particularly as their clients get older.
“A typical average household has housing wealth, multiple pension pots, savings and investments. That mix of assets needs to be managed carefully to ensure consumers can release cash at a time when they are most likely to need it, and to build in contingency plans for later years.”
Advisers should continue to invest in their skills to advise on financial plans for this type of customers, Wilkinson adds.
“Advisers could looking at qualifications in later life planning, pension transfer and equity release or advanced qualifications in financial advice.”