SIAS Event: Talk on Pension Freedoms

High-level agenda:

• For someone retiring today, dying earlier than expected is not a financial problem but dying later than expected is. They need an investment time horizon of 30 years plus.
• As Winston Churchill once said, “The farther back you can look, the farther forward you are likely to see.” A look at the history of equity markets and equity dividends.
• A strategy using equity dividends to provide a level income in retirement. How it would have fared in the past?
• Inflation. For the working population, inflation is like a broken arm; painful at the time but eventually one recovers. For the retired, it is like a brain tumour, the damage is permanent, and any recovery is at best marginal. Inflation in the past and how much protection equity dividends provided.
• Longevity risk. Annuities: poor investment; good longevity insurance.
• Managing divestment in volatile markets. Resurrecting annuity shares.
• Practical issues of portfolio construction for a retiree investing directly, diversification, future proofing, international investment and withholding tax.
• Product design issues for the Financial Services Industry.