View the article online at http://citywire.co.uk/money/article/a741954
Standard Life lowers drawdown bar to buy savers a year
Standard Life has responded to the Budget pension reforms by cutting the amount of savings people need to use its income drawdown plans.
Standard Life has cut the size of pension pots people need to use its income drawdown plan, from £50,000 to £30,000, to help them wait a year until the Budget savings reforms kick in.
Chancellor George Osborne announced this week that from Arpil 2015 anyone could cash in their pension and only have to pay a tax charge at their marginal rate, rather than the current 55%. It also introduced interim changes to drawdown that decreased the minimum income requirement for flexible drawdown to £12,000.
Standard LIfe said the new minimum amount of £30,000 would help those who are unable to benefit from the April 2015 rules allowing them to cash in their pension pot.
Rather than delaying retirement, Standard Life said pensioners would be able to take a tax-free lump sum right away and bridge the gap from now until the new rules begin in 2015.
Alastair Black, head of customer consolidation at Standard Life, said: ‘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.’
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