Sanlam has revealed a new ‘flexi-access’ facility due to go live from 6 April across both its personal pension and self-invested personal pension products will be provided without charge.
Following George Osborne’s pension freedom bombshell at the last Budget, the government confirmed three options for taking income post-April, including the new ‘flexi-access drawdown’, a lifetime annuity, or simply taking uncrystallised lump sums.
The flexi-access option sees a pension pot being placed into drawdown under a new type of fund, from which consumers can withdraw any amount over whatever period they choose.
The new pension freedoms will be implemented from 6 April 2014.
Sanlam is the latest in an increasingly long line of providers to confirm this option will be made available to consumers, including Parmenion, Zurich and Prudential.
Nick Parry, head of Sanlam Investments and Pensions, said that pensions have become “fashionable” again, perhaps even ‘cool’, not only as a means of planning and funding retirement but now also as a vehicle for the creation of tax-efficient inter-generational wealth.
“The 2014 Budget has provided the impetus for tremendous innovation amongst the providers of wealth management solutions and the benefits of this will be felt, we believe, for generations to come.”
Nigel Speirs, head of distribution at Sanlam UK, said from his perspective the changes in pension legislation say one thing and one thing only to the end consumer – ‘it’s your money’.
“The rules of the past were old fashioned and too restrictive. Pensions are again an attractive long term savings vehicle and, just like Isas, should offer customers access to their money when they require it.”
He added that the new rules will offer financial advisers a huge opportunity for ongoing engagement with their clients beyond retirement. “The need to remain invested will only result in the need for continued advice and the delivery of value.
“We think that annuities do still have a role to play in retirement income provision but more for later on in life rather than at retirement”.
peter.walker@ft.com
