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End of age 75 rule could boost scheme pensions

Scrapping the age 75 annuitisation rules could boost the market for scheme pensions by offering wealthy savers a way to sidestep the proposed cap on retirement income, according to Sipp specialist Hornbuckle Mitchell.

Director Mary Stewart says thousands of pensioners in capped drawdown could be tempted to move to a scheme pension to take advantage of tailored drawdown rates and avoid the proposed cap on retirement income.

She says: “Under scheme pensions, the maximum income that can be taken is set by an actuary based on the individual’s own health and wealth rather than Government Actuary’s Department rates which are partly calculated on average life expectancy. This gives the potential to raise income as age increases and health deteriorates. The cap-ped drawdown proposals raise the prospect of a wider spread of clients, in particular, those individuals with substantial funds outside their pensions who want maximum income but who cannot meet the minimum income requirement necessary to move into flexible drawdown.”

But Hargreaves Lansdown pensions analyst Laith Khalaf says that the cost of employing an independent actuary means this will remain an expensive product.

Khalaf says: “I do not see that this will become a mass-market solution.”


EU to crack down on derivative markets

The European Commission has branded the European derivatives market the “wild west” as it looks to crack down on opaque practices in the sector. In an attempt to follow the US regulatory overhaul of unreported speculative trades between parties, EU commissioner for internal market and services Michel Barnier yesterday announced plans to make over the […]


GE Money CEO Colin Shave to retire

GE Money Home Lending chief executive officer Colin Shave has decided to retire on December 31, 2010, after a 35-year career with GE. Shave, who is also the chairman at GE Money Home Lending, joined the business in 2003 and previously worked for GE in a variety of roles around the world including South Africa, […]


Chinese investors eye Pru’s Asian arm

A group of Chinese investors who backed Prudential’s AIA bid is reportedly considering a takeover deal of Prudential’s Asian division. A report in The Sunday Times says the consortium of investors who were behind Pru’s failed bid to buy the Asian arm of AIG are now looking at taking control of Pru’s Asian arm instead. […]

The Great British Break-Off

Despite predictions that a vote to leave the European Union would result in an economic apocalypse, UK equities have shown the market equivalent of a stiff upper lip: bouncing back, keeping calm, and carrying on. Although the road towards Brexit remains clouded in uncertainty, UK equities offer a range of opportunities to investors seeking returns […]


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