Flexible Retirement Plans - February 2012

Published by Financial Adviser | Feb 09, 2012

The concept is straightforward enough. A client can start off with a simple pension plan, and move into a different product without the prospect of charges or other problems when it comes to transferring between products.

This can be particularly useful for pensions, especially if the client is starting off with a long period ahead of pension saving. He may want to start out with a simple personal pension product, but as his circumstances change, there is a chance he would go for something that allows a bit more control, with a greater variety of assets. In which case transferring to a Sipp would be more appropriate. Within flexible retirement products, an investor can make the switch without incurring the charges of switching to another entirely new product, and with the minimum fuss.

Many product providers introduced flexible retirement plans after A-Day, and they offered flexibility, wider fund choice, and easier switching options between funds, as well as different products.

The advantage with these products is that they do not mean clients have to pay for services they are not using. So in many ways, flexible retirement plans are useful for clients investing for the long term, but as ever, the adviser has to make sure that they are suitable for the client he is advising.

Melanie Tringham is features editor of Financial Adviser