Earlier this month my brother-in-law, Ray, attended an in-house course called Your Investments: Preparing for Retirement. It was paid for by his well-known, multi-national employer of 31 years.

For almost 20 years, Ray and I have each invested a couple of hundred pounds every month, pooling our cash to acquire stocks and shares, the relative appeal of which is normally determined over a few pints on the second Thursday of the month.

The point is: prior to attending Your Investments: Preparing for Retirement with a handful of colleagues for whom the course appeared appropriate, it’s fair to say that Ray was reasonably experienced in investment-related matters.

It was disappointing, therefore, to learn that the course “was pretty basic” and “lacking in meaningful detail”. It appears that its providers were “a little too interested” in talking about cash equivalent transfer values – irrespective of the fact that transferring away from the guarantees afforded by a final salary pension to a Defined Contribution (DC) pension was unlikely to suit each attendee.

While most private sector ‘final salary’ pensions have closed to new members, the rise in workplace pension participation via auto-enrolment has been impressive. Accordingly, the volume of people with gradually expanding DC pensions will grow significantly over the coming decades. Furthermore, it’s reasonable to assume that demand from this group for ongoing investment advice, education and guidance will also grow rapidly – a scenario that creates huge opportunities for financial advisory firms.

According to polling conducted by YouGov last year, almost 40pc of people currently saving for retirement said they would welcome the opportunity to divide their pension pot so that it provided a guaranteed regular income (from an annuity) with the balance taken as ‘flexible’ or non-guaranteed income. Most people want to take the tax-free lump sum from their pension at the earliest opportunity.

This, of course, is just one retirement income option – and not a particularly tax-efficient one either, which perhaps explains why the demand for greater levels of financial guidance will continue to grow.

However, demand for advice will come from an expanding – but far from homogeneous – group of pension savers. Indeed, the cohort comprises at least half a dozen different sub-groups with the overwhelming majority of pension savers falling into at least one of the following categories:

1. The Impetuous Investor

Typically willing to withdraw the maximum amount possible from their pension pot as soon as they can, despite the prospective tax liability. Eventually, most put their pension fund balance into a cash ISA held with their bank.

2. The Extravagant Investor

Eager to access the tax-free element (25pc) of their Defined Contribution pot and spend it on items such as holidays, a new car or home improvements. The balance of their pot generally remains untouched until it’s drawn down when required.

3. The Measured Investor

People enjoying a phased retirement and comfortable taking their DC pension in drawdown before it’s topped up by the state pension.

4. The Undecided Investor

Decision-making proves difficult for this type of investor who invariably finds that several years into retirement their pot balance remains untouched.

5. The Ultra-Cautious Investor

The investor who never sees beyond buying an annuity and is comfortable in the knowledge that it’s extremely unlikely he’ll run out of money.

6. The Astute Investor

Acknowledges their limitations vis-à-vis investment and are comfortable seeking independent financial advice, both on a regular and permanent basis.

While we can apply labels to these groups, based upon their attitudes towards money or investment biases, what of the advisers?

Back in 1949, Benjamin Graham wrote The Intelligent Investor, described by Warren Buffett as “by far the best book on investing ever written”. For investors who required assistance, Graham recommended professional advisers who rely upon “normal investment experience for their results… and who make no claim to being brilliant, [but] pride themselves on being careful, conservative and competent… whose chief value to their clients is in shielding them from costly mistakes.”

Advisory firms and IFAs who recognise the very gradual but nonetheless seismic shift in pension provision would do well to heed Graham’s wise words and strive to be “careful, conservative and competent” because preventing people from making costly mistakes is just as important as making successful investments.

For more financial advice, check out Peter Sharkey’s regular blog, The Week In Numbers.