Post-Budget confusion leads to retirement revamp
The online financial planning website RetireEasy.co.uk will become a free service this month in response to a dramatic uplift in queries from retirees following recent Government changes to the rules applicable to pension drawdown arrangements.
General confusion among retirees on how to manage their pension pot from April 2015 led to a 400% increase in queries to the website over the past month1.
As a result, the founders of RetireEasy have secured investor backing based on the increased need for a financial planning tool aimed at the retirement market. This will allow RetireEasy to abolish its monthly charges and offer free access to the program which provides comprehensive projections on users’ finances, highlighting when their liquid assets will run out, funded by sponsored links to a range of financial products suitable to retirees.
Nine-tenths (89%) of the queries in April related to retirees’ confusion over how they will calculate their desired income post-retirement given the broad range of options for their pension cash from next year. In addition, 65% of them referenced the Budget changes.
Richard Collinson, CEO and Co-founder of RetireEasy, said: “There is such a renewed need for a service that gives retirees insight into how much they can spend, particularly now that they can receive their pension pot as a lump sum without the requirement to buy an annuity. We want to help people live their lives to the full, and part of this is having surety on how much capital you can spend without affecting your retirement income.”
Naomi Collinson added: “As retirees ourselves, we understand the last thing people want to do is buy a sports car and go on a world tour in their first year of retirement, to find they need to rely solely on the State Pension in the latter years of their life. We want to empower retirees to enjoy their new-found financial freedom to spend their pension as they see fit, but in a responsible way that means their immediate largesse allows them to live the rest of their days in comfort.”
Mark Soper added: “The Budget changes bring welcome flexibility for retirees but also heightens the potential risk of running out of money. Careful cash-flow planning and visualisation of how far an individual’s pension funds and savings will last in retirement has now become an absolute necessity for anyone approaching retirement. RetireEasy LifePlan meets the need, removes the worry and is now completely free to access and use.’’
A study of the Australian retirement market2, which does not require retirees to buy an annuity, found that a third of them use their pension to buy a home, pay off their mortgage or on home improvements, while 27% invest the money outside of a pension or place it in a savings account. A fifth (19%) of them buys or pays off a car.
West Sussex-based Richard and Naomi founded RetireEasy in 2011 with their financial adviser, Mark Soper, as a paid-for service. After Richard sold his City-based commercial finance business in 2004 and Naomi retired from running an art gallery, they realised the difficulty in charting one’s income throughout retirement and wanted to save other couples from the same burden.
The interactive and easy-to-use service gives users a holistic view of their future income, factoring in a range of assets such as pension entitlements, investments and savings, in order to figure out how much money they have to live on in retirement. The service is secure, free to all users and can be easily updated in response to external factors, such as changes to inflation asset values and tax rates.
RetireEasy.co.uk is the only comprehensive, online tool that gives those in or nearing retirement peace of mind by empowering them to plan for their financial future.
Its online planning service, LifePlan, is a free, highly interactive, intuitive, flexible and easy-to-use web-based program, which is an entirely safe and secure resource.
RetireEasy.co.uk aids multi-asset financial planning by optimising capital and income, factoring in debt liabilities such as a mortgage, along with a range of assets including property, one or more private retirement plans, investment portfolio and cash.
The business was formed in May 2010 and launched in September 2011 by Richard and Naomi Collinson, and Mark Soper.