Standard Life has lowered the minimum amount customers need for its drawdown product range from £50,000 to £30,000.
This brings it into line with the maximum amount for trivial commutation, which was lifted from £18,000 to £30,000 by chancellor George Osborne in his Budget yesterday.
Currently retirees can only take their pension pot as a lump sum if it is less than £30,000 (raised from £18,000). From next year, subject to consultation, there will no longer be a maximum point at which savers are unable to take their pension pot as a lump sum.
Standard Life shares took a beating after George Osborne’s announcement yesterday, closing £260m down.
Alastair Black, head of customer income solutions at Standard Life, said: “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.
“When the pension rules change, they can then review their strategy. The flexibility and choice offered by income drawdown allows them to do that.
“This added flexibility also brings 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.”
Standard Life said in a statement that it had £10bn in assets under administration in drawdown as of January 2014.