Partner Insight: Shifting retirement landscapes and the COVID-19 challenge

Since 2015, the retirement landscape has shifted with new government rules around pension freedoms allowing individuals more choice in how and when they access their retirement savings.

clock • 2 min read

Individuals now have the option to leave their pension pot intact until retirement or start accessing it from age 55; secure a guaranteed income with an annuity or employ flexible income options by remaining invested; take cash out in amounts to suit personal requirements or access their whole pension savings in one go. The freedoms also allow individuals to combine options.

Unsurprisingly, as a result of the new rules, the way retirees have accessed their pensions over the past five years has changed significantly. From April 2015 to July 2020, retirees have opted for pension withdrawals totalling almost £37bn. Somewhat surprisingly, considering the guaranteed lifetime income they provide, the take-up of annuities is also on the decline, with only 11% buying an annuity in 2018/2019 - down from 13% in 2016/2017.

Yet the market is in a very different place today compared to 2015, and there are a number of issues those planning for retirement need to take into consideration.

The impact of COVID-19 on stock markets is concerning for individuals whose pension savings are invested in them. The need to spread your investments across a range of asset classes to ensure they are properly diversified, with the aim to protect them from market volatility, is now key.

The amount of money required to fund a comfortable retirement continues to grow too, yet with interest rates sinking to an all-time low in 2020, the ability to secure such an income has become much harder. Low interest rates mean any savings invested in bank accounts are unlikely to provide returns that outpace inflation over the long term. And with most banks offering savers rates of less than 1.5%, cash savings do not offer much in terms of annual returns to retirees anyway.

Meanwhile, longevity risk - the risk of outliving your savings - is also a rising concern with the Office for National Statistics stating that improved healthcare and lifestyle changes are leading to more people living to 100.

Never has it been so important to analyse your own personal retirement plan and understand your options in order to secure your income for the future.  For help choosing the right retirement game plan for your clients, and exclusive content to help navigate today's challenges, read the guide to retirement from Architas.

.     

Read Guide Here

More on Retirement

Partner Insight: The psychology of retirement

Partner Insight: The psychology of retirement

Bridging the advisers-clients gap: How emotional intelligence can help build deeper trust with clients and better understand their financial goals

James Woodfall, Raise Your El.
clock 15 September 2025 • 1 min read
Managing drawdown risk: A new frontier in retirement planning

Managing drawdown risk: A new frontier in retirement planning

'Volatility alone is no longer a sufficient risk measure'

Matthew Wright
clock 29 August 2025 • 4 min read
Sounding the alarm: Facing the retirement reality check

Sounding the alarm: Facing the retirement reality check

'At the heart of the issue is a worrying lack of engagement'

Laith Khalaf
clock 17 June 2025 • 3 min read

In-depth

'There are sharks out there': V11 footballer plight highlights professional athlete financial vulnerability

'There are sharks out there': V11 footballer plight highlights professional athlete financial vulnerability

‘Sadly, in every industry there is good and bad'

Jenna Brown
clock 03 September 2025 • 8 min read
Targeted support: 'Watch this space!' – unknowns persist

Targeted support: 'Watch this space!' – unknowns persist

Industry awaits final details of the FCA’s proposals

Isabel Baxter
clock 19 August 2025 • 7 min read
Polling high – should advisers bank on Reform UK holding on?

Polling high – should advisers bank on Reform UK holding on?

Nigel Farage-led party's policies would likely mean big tax changes if Reform came into power

Isabel Baxter
clock 30 July 2025 • 7 min read