Personal PensionMar 28 2014

MetLife in post-Budget limit drop on unit-linked range

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MetLife is reducing the minimum initial investment needed for its range of unit-linked guarantee products in response to the changes wrought in this year’s Budget.

The insurer is lowering the minimum investment for its unit-linked guarantees to £30,000 from £50,000, and reducing the minimum regular contributions from £3,600 to £1,200. This will allow savers to contribute as little as £100 per month to their pension.

From April, MetLife will also allow clients to take advantage of the new 150 per cent maximum ‘capped’ drawdown income.

Among other changes, chancellor George Osborne last week raised the total amount of pension funds that can be taken as cash to £30,000 from £18,000 and increasing GAD limits on ‘capped’ drawdown products.

Standard Life, Aviva and LV each subsequently reduced their minimum drawdown pot size to £30,000.

Dominic Grinstead, managing director of MetLife UK, said the company will help with adviser training in retirement income, but that adviser knowledge must “go hand in hand” with consumer education.

He said: “The Budget changes reflect the fundamental shifts in longevity and attitudes to retirement across the UK and will instantly benefit all savers and future retirees.

“We believe guarantees will play a major role in delivering flexibility and certainty. There remains a need for further innovation particularly ahead of new rules in April next year.”

To read a full overview of unit-linked products and earn 30 structured CPD minutes, click here.