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GE aims to draw retirement crowd

GE Life&#39s phased drawdown is designed for people who need income but not a lump sum and who want to defer annuity purchase.

The firm thinks it will have particular appeal to people who are making the transition from part-time employment to full-time retirement. It will also be of use to people who want superior death benefits compared with annuities and are concerned with inheritance tax planning.

The plan enables income, which is provided through a combination of tax-free cash and drawdown payments, to be taken whenever it is needed and there are four investment options. The GE Life unit-linked investment option provides access to 41 funds managed by GE Life and external fund managers.

The discretionary pension portfolio option provides tailored portfolios through links with Cazenove, Morgan Stanley Quilter, Rathbones and Tilney. It is available to people with pension funds of at least £200,000. However, a minimum of £3,000 must be invested in GE Life&#39s unit-linked funds.

The simplified Sipp option provides access to a range of collective investments, including GE Life&#39s unit-linked fund range. Minimum investment is £100,000 but investors would need to place at least £100,000 in GE Life&#39s unit-linked funds. The Sipp option offers the widest choice of Revenue-permitted investments but at least £20,000 must go into GE Life&#39s unit-linked funds.

This product brings similar features to Scottish Equitable&#39s flexible pension plan to the income drawdown market. This is useful as income can be targeted to meet the individual&#39s needs while the rest of the pension pot remains invested in an appropriate arrangement. However, there is too much going on within a single product and it may be difficult for IFAs to explain to clients how it works.


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Scheme pays explained

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