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Pru suite marks pension return

Prudential is planning to launch a suite of pension products that will combine elements of equity release and the more flexible investment options around residential property that A-Day offers.

The products will mark Pru’s re-entry into the personal pension market after a four-year absence and are due to be rolled out from the New Year in the run-up to April.

Although still in development, the firm is planning a Sipp that can be used in conjunction with its equity-release products, enabling home- owners to extract the value of their main or second residence. This will then be used to fund the purchase of a buy-to-let property – effectively gearing up the portfolio – which will then be held in the Sipp. Pru expects fewer individuals to favour selling their main residences to their Sipps.

The pension-based lifetime mortgage schemes will build on the equity-release products that Pru launched last month.

Pru UK chief executive Mark Wood says: “We are working on ways of making the process as smooth as possible but it is too early to talk about specifics.”

Roberts Clark director Jo Roberts says: “Property in Sipps is really tax-efficient but the BTL market is saturated at the moment.”

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