Revolutionise your whole approach to suitable retirement income advice
Apr 12, 2021 12:39:25 PM
Our new income-focused attitude to risk questionnaire and risk rating service will seek to support your advice process by matching your client’s risk profile more accurately to suitable funds that provide sustainable income levels in retirement.
We are pleased to announce the launch of our new ESG enabled income risk questionnaire tool; EV Income Risk Profiler. This tool is now available to financial advisers, along with many other financial planning professionals. It is the first of its kind that maps directly to our comprehensive income risk ratings service for fund providers and asset managers.
Supporting EV Income Risk Profiler is our brand new EV Income Risk-Ratings, a range of risk-rated multi-asset income funds.
This combination ensures you can seamlessly achieve your client’s decumulation objectives. To take this to the next level, we are now working with a variety of fund providers and asset managers to optimise their underlying asset allocations, mapping these to suitable fund choices that align with your client’s capacity for loss in retirement.
We believe this new income risk profiling methodology brings to income the same efficiency and rigour you currently experience with growth.
The benefits of our comprehensive income risk methodology
Easily match your client’s risk profile with suitable income risk-rated fund recommendations;
Quantifiable risk communication powerfully making a case for regular adviser reviews;
Consistent with the growth questions to create a complete objective specific suitability process for your advice process;
Risk descriptions for each risk profile provide information to help you communicate the potential outcomes and risk associated with each risk profile.
Greater precision in measuring risk and ensuring suitability allows higher-risk strategies and a higher income for clients with good capacity for loss;
Efficiency rating for funds to show how good they are for using to deliver income.
Gary Wheeler, Chief Commercial Officer at EV, comments,
“Unlike in the accumulation phase, our research has found that risk appetite changes when an individual is at or in retirement. Individuals in our study were almost 20% more likely to result in a risk band 2 or 3 out of 5 risk profiles when answering our risk questionnaire for an income objective and with capital directly at risk. Conversely, those who were completing a questionnaire with the objective of growing an investment were more than twice as likely to be placed in risk band 4 or 5 respectively out of 5 risk profiles.
While understanding a client's risk appetite while delivering a sustainable level of income through appropriate investments is paramount to an adviser’s suitability process. In line with our research, we formulated a specific income risk profiler questionnaire that seeks to identify an individual’s capacity for loss, rather than their appetite for investment growth. We are now inviting financial advisers to sign up for introductory access to our ESG-enabled income risk profiler before we are due to launch our fully integrated adviser tools later this year”
Addressing your clients changing preferences for ESG Investing
In March 2021, we conducted a survey of 7500+ people and found that astoundingly 94% considered at least one ESG; environmental, social, or governance factors to be important when making decisions about their investments for income and/or growth.
Research also shows a 374% net inflow increase for ESG funds in the first nine months of 2020 compared to 2021, according to FTAdviser, showing the demand from clients for ESG investing is here and not going away.
Combining this with figures from the Investment Association, highlighting a quadrupling in ESG investments throughout 2020, has resulted in our ESG enabled risk questionnaire tool for growth and income.
How do I gain access?
Our new EV Income Risk Profiler is available across 5, 7, and 10 risk profiles, and we are offering introductory access to the income risk questionnaire to both existing and new clients now. By signing up, we will be giving you priority access to the latest information around future software releases, service updates, and integration plans with our industry partners.
If you would like to learn more about our income risk methodology and experience the income risk profiler live, join us at 11:00 am on Tuesday 27th April for our next webinar. We will be discussing how to strategically incorporate the questionnaire into your current process and create suitable and sustainable retirement plans for clients whilst assessing their preferences for ESG.