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LV= launches simplified drawdown product

Press release: 02/06/2014

Retirement specialist LV= has added a simple drawdown option under its low cost personal pension plan following the retirement income changes announced in the Budget.

LV=’s low cost pension was launched in February 2012 and has a 0.25% annual service charge, with assets over £1 million charged at just 0.1% per annum. Clients holding an LV= low cost personal pension with funds of £37,500 or more after tax free cash will now be able to access income drawdown for £175. Clients with funds below £37,500 can access drawdown for an initial fee of £295.

Clients need to start their plan with a single premium or transfer of at least £20,000. A minimum fund size of £30,000 (including tax free cash) is required to take out the drawdown product.

LV= has developed a complete investment range that allows insured fund investment into passive or active strategies, and a wide range of fund managers. LV=’s low cost pension also allows advisers to switch clients into its self-invested pension plan, should their circumstances change.

Richard Rowney, Managing Director of LV= Life and Pensions said: “We have launched this product in direct response to the changing retirement landscape, and subsequent adviser demand for a low cost, and simple drawdown solution. This product will be offered alongside both our guaranteed income drawdown, and our self-invested income drawdown proposition.

“Our aim is to work with advisers to provide the retirement income options that meet the needs of their clients. We recognise that those clients who would traditionally have had little choice but to annuitise in order to take benefits now have a variety of options to choose from. This option provides those clients with a way of accessing income drawdown, and or accessing their tax free cash.”

In response to the Budget, LV= has made significant changes to its proposition including reducing the minimum gross contribution for drawdown from £50,000 to £30,000. It was also one of the first to lower the amount clients require for flexible drawdown to £12,000.

To support the adviser community during this transitional period, LV= has launched its ‘Take Heart’ campaign to help advisers to add real value to their clients’ retirement plans. This campaign has included the launch of a new retirement desk helpline, a dedicated microsite which provides advisers with greater clarity as to what their client’s options are post Budget and a host of seminars across the country which focused on the retirement income changes.