Hargreaves Lansdown unveils flat-fee retirement planning service

Hargreaves Lansdown is to launch a new low-cost retirement planning service in response to the pension freedoms.

The firm will offer a flat fee service for £395, which will cover an hour with an adviser as well as a report on key issues for the investor to cover.

It will also include a cashflow projection to show individuals how asset positions are affected by drawing their desired level of income.

However, Hargreaves says the service will stop short of providing specific, personal recommendations.

Should investors wish to move from the retirement planning service into full advice, their fees will then be deducted from the extra costs.

Hargreaves charges 2 per cent for full advice on the first £200,000, then 1 per cent of the balance from £200,000 to £1m, and 0.5 per cent of the balance over £1m.

Hargreaves Lansdown head of pensions research Head of pensions research Tom McPhail says: “We think there is a demand for a transactional service and straight forward service that sits somewhere in between the excellent work of Pension Wise and a full personalised advice serve that will typically cost upwards of £1,000.

“Pension Wise is fantastic, and I think take-up needs to be improved, but even if we get 100 per cent coverage there are elements of customer needs that it cant satisfy.

“It can’t take people on to the point of transaction. They can talk around what products are out there, but it can’t take people any further than that. A lot of investors don’t want a full on adviser service, but they want to be talked through the process.”

Hargreaves estimates market demand of 120,000 investors a year for the service, having a completed a survey of 300 over 55s which found 65 per cent would value talking through their retirement with an expert.

And while 28 per cent said they wouldn’t be interested in paying for the service, more than 50 per cent said they would pay between £100 and £499.