Almost three quarters (74%) of independent financial advisers (IFAs) have re-evaluated the role of annuities in retirement planning following changes in the Autumn Budget, Standard Life has found.

The firm’s latest research comes as pensions are set to be brought into the scope of inheritance tax (IHT) from 2027.

Standard Life’s study also looked to examine how advisers are actively responding by re-evaluating how to best structure income for their clients in later life. It revealed that 82% of IFAs have re-evaluated the role of pensions in their clients’ plans, with 10% undertaking a full review across their client base.

A further 69% of IFAs have either already advised or are planning to advise their clients to increase the level of income they take in retirement. Of those IFAs having these conversations, 43% have recommended an increase in retirement income of 5% or more.

Standard Life found that 27% of IFAs have increased the number of annuity purchases they are recommending, which it said reflects the latest ABI annuity sales figures, after it increased by 24% in 2024, reaching a new 10-year high and totalling £7bn.

Managing director of individual retirement at Standard Life, Claire Altman, said: "The planned extension of IHT to cover pension assets from 2027 has clearly had a profound effect on how IFAs are advising their clients, and the fact that such a large number are having conversations with their clients about increasing the level of income they take in retirement gives a clear signal as to how advisers are responding to these changes.

"Traditionally, advisers have used a benchmark of 4% when it comes to client pension withdrawals each year, and it is striking to see that they are now advising an additional 4% on average, with significant numbers recommending an additional 5%.

"In addition to increasing withdrawal rates for those in drawdown, advisers are also considering other means of taking an income and are turning to annuities in increasing numbers due to a combination of the certainty they provide and the attractive rates on offer."

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