Lighthouse group’s occupational pension scheme offering, the Lighthouse Pensions Trust, has announced it intends to offer AllianceBernstein’s Retirement Bridge as an “alternative to early annuitisation” for members at retirement.
Retirement Bridge is designed to provide flexibility for members between accumulation and eventual annuitisation, with the companies claiming it offers “good value” for money for pots of £20,000 or more.
Under the plan, members have access to their assets at any time from their retirement window opening at age 55 through a ‘collective drawdown’ arrangement, during which time they can continue to contribute to their fund.
Members would then transition at age 75 to solely taking income by either annuitising or moving into “other forms of drawdown”. The product uses an “age-appropriate” asset allocation strategy, with the default option being the BirthStar Target Date Funds, also managed by AllianceBernstein.
A single charge, previously reported to be “considerably less than 1 per cent” is applied by Alliance Berstein for using the product, which would apply on top of administration charges levied by Lighthouse.
Roger Sanders, managing director of Lighthouse Group Employee Benefits, said: “At age 65, retirees now have a possible 20 year retirement phase – annuities were not designed for this, particularly in the current yield environment.
“However savers will value a more certain income, so Retirement Bridge followed by annuities or other forms of drawdown at 75 provides more choice and better outcomes for our members approaching retirement.”
Tim Banks, managing director for pensions strategy at AllianceBernstein said: “Our fundamental belief behind Retirement Bridge is that individuals should not be rushed into making binding retirement decisions that they are insufficiently prepared for.
“In order to cater for the real uncertainty in the early years of retirement, our diversified investment strategy embeds age-appropriate advice to deliver a sustainable monthly income that is expected to grow over time.”
ruth.gillbe@ft.com