Portal Financial, an advisory firm which says it deals with 2000 income drawdown cases a year, has reported an 80% rise in demand for retirement advice post-Budget.
It also reports a move away from execution-only sales and a trend towards "a more considered approach based on advice."
Portal says that the pension reforms have highlighted the diversity of retirement options available, such as whether the retiree would like to receive a guaranteed income, remove money as needed from their pot, have death benefits for their spouse, or their fund to remain invested for a later date.
The pension overhaul means that those approaching retirement have a wider array of options than before, and many of Portal Financial's clients are now keen to take advice to explore all their options, rather than immediately opt for an annuity, says the company.
Prior to the announcement, the FCA found that 60% of people at retirement age would stay with their existing pension provider for an annuity, often without exploring alternatives that potentially could offer greater income, flexibility or benefits. Since then, sales of annuities and shares of annuity providers have dropped, with Legal & General reporting a 40% decrease in sales in the first quarter compared to the same period last year.
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The chancellor's Budget created concern that the annuities market could cease to exist entirely but annuities remain in some cases the best option for people who would like a fixed income guarantee throughout their retirement, according to Portal.
The company believes that part of the reason for the shift away from annuities is the low income they offer: in 1995, a 65 year old with a £100,000 pension fund could have received an annuity of £11,380 a year; today the annuity would be around £4,920.
Jamie Smith-Thompson, managing director at Portal Financial, said: "Annuities remain an inflexible solution. One of the great benefits of the Budget was that more people are now aware of alternatives, such as Income Drawdown, and want to fully understand all of their retirement options."