Retirement
Standard Life cuts income drawdown minimum
Standard Life has cut the amount that customers need to have saved to access its income drawdown range from £50,000 to £30,000 in response to yesterday’s Budget announcement.
The provider said the move would assist people who will not be able to benefit from the new rules for small pension pots.
It said rather than delay retirement, they can take a tax free lump sum immediately and use its drawdown to “bridge the gap until the new pension rules enhancing control and flexibility are introduced in 2015”.
Standard Life head of customer consolidation Alastair Black explained: “The Chancellor announced some of the most significant changes to the retirement marketplace ever. The main changes won’t come in to force until 2015 and some people might be considering delaying their retirement until then, to benefit from the increased flexibility and control.
“But Standard Life believes drawdown will help to bridge the gap and put people in a strong position. By using drawdown, they can take an income that supports their needs in retirement, while ensuring their pension pot remains invested. Then, when the pension rules change, they can then review their strategy.”
People need professional help
He added extra flexibility brought more responsibility. “People will need professional help to think about where they invest their money, how they can use this flexibility while having a long term sustainable income and how they minimise their tax.”
