Liability Management

Managing the liabilities as well as the assets

Many schemes provide a pre-determined retirement income for members, specifically an increasing pension which continues to a dependent on death. Whilst this income stream may be appropriate for some members; others may prefer a more flexible retirement income.

Income needs do not continue to increase in retirement for everybody; typically, they reduce with lower activity levels after the early years of retirement. Indeed, many individuals either do not expect to reach old age or perceive their income needs will flatten. Those lucky enough to enjoy a very long retirement may need additional income in ‘old age’ for long-term care costs.

The Government’s freedom and choice legislation allows individuals the ability to restructure their income to meet their needs better. Member option programmes give members a greater choice on the retirement income, but this must be combined with a clear, easily accessible advice process. A suitably qualified adviser will be able to help your members answer all the questions they have through their journey.