Meeting the income needs of today’s investor

Aviva Investors

Today’s investors face an unprecedented level of personal responsibility in planning for their financial future. Ensuring that they have the income to see them all the way through their retirement is just one of the challenges, particularly in light of the persistently volatile, low growth, low interest rate environment. This research examined investor attitudes to retirement in the post freedoms world, the way in which advisers are responding, and the importance of looking beyond the traditional asset mix.

The research programme comprised depth interviews and focus groups with advisers and wealth managers across the UK. These qualitative insights were supported by a quantitative survey of 200 IFAs and 500 individual investors, all with any of: pensions, cash or stocks and shares ISAs, or other investments.

Among the key research findings was that 4% was considered to be the new 5%, that is, 84% of advisers considered a yield of above 4% to be unsustainable. Longevity and the pension freedoms have introduced new challenges; as one adviser put it: “The pension freedoms have shone a spotlight on the value of staying invested to and through retirement and yet how much money is needed and how long it needs to last remain questions that are difficult to answer and advise upon.”

In addition to informing Aviva Investors’ marketing and business development activity, the findings helped to raise awareness of the firm’s commitment to deliver the specific and meaningful outcomes that matter most to today's investor.