Prudential ditches Flexible Retirement Plan

Prudential ditches Flexible Retirement Plan

Prudential will close their Flexible Retirement Plan to new business on 17 September 2018.

The provider confirmed to FTAdviser that it will stop accepting new top-up contributions or transfers and no longer accept new money into the income drawdown option.

Advisers and customers are being informed of this decision, and existing customers will be able to continue paying existing regular contributions.

A spokesman for Prudential said: "Customers who want to move into income drawdown can talk to their advisers and switch into the Prudential Retirement Account.

"It was launched in 2016 on a new administration platform and is a more flexible product offering a greater range of features."

The Flexible Retirement Plan was launched in 2005 as a personal pension.

A Sipp option was launched in 2006 with drawdown added in 2007 and Prufund options in 2008 to 2009.

However, The Prudential Retirement Account (PRA) was launched in 2016.

It was the first in a new generation of flexible online propositions and, according to a spokesman for Prudential, PRA is now the provider’s lead product in the individual pension market and takes 90 per cent of new business sales.

William Burrows, financial adviser with Better Retirement and an author of retirement guides, said there was nothing ominous about the move.

He said: "I think it is just a matter of replacing an old drawdown plan with the more modern and lower charging Prudential Retirement Account.

"There is now clearly a trend by the big providers to move Sipp and drawdown plans on their online platforms.

"The good news is the charges are lower but advisers and their administrators have to do more of the work. In my experience, there is a learning curve, but once you are familiar with the platform it works well."