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Helping you with the drawdown advice process

We've created a range of technical support materials to help you with the drawdown advice process. Find out how we can help you with this complex area of financial planning.

Clients looking to access their pension have many options open to them so it requires careful consideration of the pros and cons of each before a decision is made. As a financial adviser you need a full understanding of the options available and the client's personal circumstances and objectives before making a recommendation.

FSA's advice guidance

We have summarised the FSA’s guidance to the advice process below:

  • Link recommendation to client's personal and financial circumstances
  • Ensure product recommended is appropriate for client’s attitude to risk
  • Consider relative importance of product to client’s financial well-being
  • Discuss all options available and reasons for discounting them
  • Consider the suitability of the product if the client is still working
  • Pay regard to client’s information needs
  • Provide all information to the client in a balanced manner
  • Record all essential client information.

Acquiring this expertise takes time and effort. So to help you we've created a suite of technical support material to build on your existing knowledge of the 'at retirement' market and give you the tools to help you determine whether income drawdown is appropriate for your clients.

Why is this important?

  • The FSA requires you to have a full understanding of the available options and be able to explain the risks of each option before advising clients to use drawdown.

  • You are more able to demonstrate the value of your advice if you fully understand and are able to explain all the options available.

  • It may help you to retain clients for longer and so increase the revenue generated for your business.

Our technical drawdown support material

Building on our many years of experience in the drawdown market we’ve created a range of technical leaflets covering all aspects of the drawdown advice process. The topics covered are:

Comparing retirement benefit options

  1. Advantages & disadvantages
  2. Case study

Building investment portfolios

  1. Portfolio construction & review
  2. Income withdrawal strategies

Income drawdown advice process

  1. FSA's guidance
  2. Client considerations

PCLS recycling

  1. What are the conditions?
  2. What are the consequences?

Calculating max GAD income

  1. How to calculate max income
  2. Advice implications

When max income is recalculated

  1. Formal & additional reviews
  2. Advice implications

The critical yield (CY)

  1. Definition of critical yield A & B
  2. Factors that influence the CY

Death benefits

  1. Crystallised & uncrystallised benefits
  2. Spousal by-pass

If you would like a pack containing our technical leaflets, simply complete our online request form and we'll send one out to you.

How we can help

Income Release is our fully integrated income drawdown facility which allows your clients to tailor pension benefits around their changing circumstances.

Once you've identified those clients that could potentially benefit from using an income drawdown plan we’ve a range of material for our Income Release proposition that you can use with them, including:

  1. Client Leaflet
  2. Client approach letter
  3. Sample suitability letter

If you'd like to find out more about Income Release or request an illustration contact your usual Scottish Life consultant or account manager.

For professional advisers only