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Managing customers in drawdown

By Lorna Blyth, Investment Marketing Manager

Delivering a decent drawdown review process takes time and resources. This article looks at how you can manage drawdown clients in a more cost-effective way.

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Most advisers are seeing an increase in drawdown clients following pension freedoms. Often these are clients with lower fund sizes, which means advisers are more often than not dealing with a much wider range of drawdown clients than before. Each will have a different set of circumstances and require support and guidance with their drawdown arrangements.

The consideration and potential mitigation of risks is crucial when delivering retirement advice regardless of the type of solution being considered for the customer. From a drawdown perspective the regulatory requirements are rightly increasing and advisers and clients need to consider a number of key items.

These include:

  • income budgeting
  • taxation
  • longevity outlook
  • appetite for loss
  • investment approach
  • potential impact on capital and income from market movements

Clearly there are lots of issues and risks to consider, which means drawdown planning is potentially more complex and time-consuming for advisers to deliver.

We think there is a real need in this market for a service that helps advisers to meet regulatory requirements in an efficient way, while also bringing home some of the realities of drawdown planning discussions.

If you are interested in looking at a new way to manage your drawdown clients then please contact your local consultant and ask about the new Drawdown Governance Service from Royal London.

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