Income investments will need to work harder as the retirement landscape changes, says HSBC Life UK.
According to a nationwide study from HSBC Life, advisers expect around 43% of their clients to work past standard retirement ages and 29% of their clients to retire overseas.
Meanwhile, around 44% of clients working with advisers expect to work and generate income beyond standard retirement ages, rising to 64% among those aged 35 to 45. Nearly a quarter (24%) expect to or plan to retire abroad.
HSBC Life said research for the report underlines the “pressing need” for income from investments. Advisers estimate that around 45% of their clients have a current need to generate an income from their investments, however 42% are drawing on capital rather than on natural income.
Mark Lambert, head of onshore bond distribution at HSBC Life UK, said: “The idea of a standard retirement age linking in with state pension age still resonates. It is a reasonable point in time to be used in financial planning where an adviser’s client is not ready to confirm exactly what they wish to stop working but clearly the landscape is changing and will continue to change as will views on retiring overseas.
“The growing shift in retirement attitudes is part of the evolving way that people plan for retirement and how they use investment vehicles other than pension products in that process. Being able to generate a tax-efficient income, for example, through tax effective wrappers like onshore bonds could well contribute to the answer.”