You are here

Investor decision making in the freedom of choice retirement market

This Research Working Party seeks to understand investors as they approach retirement, and through it, the decisions they face, and the impact of those decisions and identify ways in which investors can be supported in making better decisions

Themes to be considered are:

Understand the choices and decisions investors face before and during retirement

  • what options do investors have, what are their priorities throughout retirement, and what trade-offs are necessary to achieve their priorities?
  • what do investors view as the biggest risks throughout retirement?
  • what criteria, tools and resources do individuals favour to help them make decisions?
  • are investors homogeneous in terms of decision making, or are there distinct identifiable groups? For example, do decisions vary depending on savings vehicles, size of retirement funds available, attitudes to risk and cost, personal circumstances etc?
  • how these decisions have affected outcomes for retirees in the past?
  • do regulatory and economic backdrops, as well as events such as Brexit, have an impact?
  • what can be learned from other countries such as Australia and the USA where such decisions have been more commonplace?

Identify areas in which investors can be supported in making these decisions

  • what models best describe investor behaviour?
  • what models may be developed to assist investors in making key decisions?
  • how may said assistance be best communicated to investors by product providers, financial advisers or other sources?
  • what are the key components of a ‘successful’ retirement product, and would new products or features potentially give better outcomes to investors?

In developing this understanding, some elements of public opinion surveying may be required, dependant on the research and data available.

With the ‘freedom of choice’ regime now in place for almost four years, the Working Party is currently finalising a Review Paper setting out its findings in these areas to date. This will include next steps in better understanding issues around heterogeneity around different groups and through the retirement period, as well as the communication and product aspects.

Initially, the Working Party will aim to build foundations by focussing on:

  • develop an initial knowledge of the key options available to individuals, and the decisions that individuals are faced with when choosing how to fund their retirement income
  • understand customers’ broad decision-making criteria at a high level e.g. what can we learn from the overseas’ experience, as well as research already carried out on areas such as the ‘annuity puzzle’.

With this in place, we can then better tackle the issues around heterogeneity around different groups and through the retirement period, as well as the communication and product aspects.



Chair: Michael Walsh
Membership: 3
Established: 2016

Related documents

Contact Details

If you want more information about this research working party please contact the Communities Team.

Filter or search events

Start date
E.g., 26/09/2021
End date
E.g., 26/09/2021

Events calendar

  • Spaces available

    A panel discussion with investment representatives discussing the impact of investment on climate change and vice versa.

    This event is part of The Road to Glasgow: IFoA’s Sustainability Thought Leadership Series which will provide a platform for prominent contributors so that our members and others can understand the perspectives of a wide range of parties interested in the climate debate.

  • Spaces available

    Climate change is one of the greatest risks facing our world today. Addressing it will require multi-faceted solutions. Through this panel session, we will explore the different levers that can be used to meet net-zero targets including climate science and data, government engagement, and mobilising green finance.

  • Spaces available

    How governments and societies collectively respond to the climate crisis is increasingly being analysed through the lens of intergenerational fairness. Our expert panel will assess and explore the extent to which inter-generous fairness is being considered in climate policies, the lessons from those countries who are leading the way on fairness and justice in climate interventions, and more.

  • The Growth Mindset for Actuaries

    13 October 2021 - 8 December 2021

    Spaces available

    This practical course is aimed at actuaries at any stage of their career who want to develop their own growth mindset and apply it to their work setting and personal or professional lifelong learning. The content of the course builds on the lecture given by Dr Helen Wright on Growth Mindset as part of the President’s 2021 Lecture series, and will be delivered over a period of 2 months, from mid-October to early December.

  • Spaces available

    The climate crisis and the degradation of our planet will affect societies everywhere. How we address these threats will require solutions that transcend borders. As a global profession, the actuarial community is well-placed to consider and propose effective risk management solutions to help manage the climate crisis.

  • Spaces available

    Content will be aimed at all actuaries looking to understand the issues surrounding mental health in insurance and in particular those looking to ensure products and processes widen access for, and are most useful to, those experiencing periods of poor mental health.