Intelligent Pensions launches low-cost drawdown plan
Retirement advice firm Intelligent Pensions has launched a fixed low-cost drawdown plan ahead of pensions freedom on 6 April.
The company said the plan was an extension of its Pathways service and would allow defined contribution (DC) pension savers to transition into flexi-access drawdown with ongoing advice.
It added many pension schemes were not planning to offer such an option meaning scheme members would have to transfer out to take advantage of the new flexibilities.
The new Intelligent Pensions drawdown plan carries an annual charge of 0.75% matching the new charge cap coming into effect in April for default funds on auto-enrolment schemes.
The 0.75% charge includes all the administration costs provided by self-invested personal pension operator James Hay, as well as the annual management charges on a wide range of investment funds.
The company said flex-access drawdown is only suitable for people who are willing to take a “fair degree” of ongoing risk in retirement. It recommends ongoing advice in all cases.
The company charges an implementation fee of 1% for funds of £100,000 or more, the level that is generally considered the minimum suitable for pension drawdown.
Managing director Steve Patterson said: "Ongoing risk management is second only to initial suitability and anyone who thinks of drawdown as a DIY process is highly likely to come unstuck with potentially disastrous effects."
“‘One size fits all’ solutions are no longer appropriate – everybody’s retirement will be different. To achieve the best possible retirement outcomes a far more personalised approach is needed.”