The HL Retirement Planning Service will, the firm hopes, fill the “advice gap” between the official Pension Wise initiative, and costly professional financial advice.

Retirees will be asked to complete a short questionnaire, and will then receive a report detailing their retirement income options, and the tax consequences of each option. They will also be given an hour to speak with a financial adviser, but will not be advised which option suits them best.

Hargreaves Lansdown believes the service will appeal to a range of retirees, and forecasts an initial market of around 120,000 clients. The launch of the service follows internal research that found a sizeable market for low-cost advice; over two-thirds of those polled wish to discuss their retirement options with an expert.

Clients will be charged a flat rate of £395 plus VAT – although, if they decide they require more help from an adviser, they can opt for a full financial planning service, and the flat fee will be waived. Full pension advice from the firm will cost 2 per cent of the total value of the investment for full pension advice.

Tom McPhail, head of pensions research at Hargreaves Lansdown, said the service aims to ensure retirees are “comfortable with making a decision, or recognise that they need more help.”

“Pension Wise may tell you to shop around if you want to buy an annuity, it may talk to you about drawdown and point you to a website and talk through the merits of drawdown and how it may work,” McPhail says.

“We take it to the next stage, and work out how much tax you will be liable to pay and how to shop around. We will use cash flow modelling to model your income stream and how it will be affected by withdrawals.”

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