26% of SIPP providers will not offer flexible drawdown options

Increase in pension fees

Increase in pension fees

A survey by a leading independent financial research company, Defaqto, has revealed that only 61% of all SIPP providers can currently offer flexible drawdown to its customers.

With a new finance bill just released, they found that advisors will have to be aware of changes in the terms they offer, as they look to help their clients take advantage of the changes.

The new bill, named the 2011 Finance Bill, came into force last week and allows advisors to take advantage of the new changes to the rules relating to the income drawdown system.

The survey, which was conducted over the last few weeks found that 26% of providers would not be offering a flexible drawdown option from the changes to the bill.

Matt Ward, a wealth management consultant from the firm revealed, “While today’s changes to the income drawdown framework present challenges to advisers, they also offer key opportunities for IFAs to secure client business.  However, it is important for advisers to be aware of these changes and the associated planning ramifications for those clients approaching, or already in, retirement.

“In particular, when it comes to flexible drawdown, IFAs need to understand the terms being offered by SIPP providers in order to advantage of the changes for their clients’ benefit.”

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