Key Retirement to close pension advice arm

Key said that its target market, who have funds of between £50,000 - £100,000, are largely unwilling to pay for advice and that as a result the firm would be 'scaling back the business'.

Key Retirement launched its Retirement Options service in January to help savers understand their expanding range of choices ahead of the pension freedoms.

Dean Mirfin, technical director at Key Retirement, said:

“Our core target market with funds of between £50,000 - £100,000 who are very much underserved in terms of access to advice fundamentally are shying away from wanting to pay for advice, or simply do not see the need for it where they have clear goals. As a result we have made the decision to scale back the business and to retain a smaller non-advised team. With the Treasury and FCA work under the FAMR the landscape for these customers and how they access best outcomes is still changing, but many are comfortable with a non-advised outcome where this is to achieve a guaranteed income from an annuity. However many looking to drawdown are typically low or no risk meaning the economies of transacting for such clients under advice are not economical in the eyes of many clients.

“Members of the team effected by the decision to scale back the operation to non-advised only are currently under consultation and where possible we are looking at opportunities elsewhere within the group for them.”