Aviva is launching its new Fixed Term Retirement Plan, a retirement income plan that doesn't lock customers in for life. It gives customers the option of taking tax-free cash, if they haven't already, an income, or both from their pension fund.
It offers two investment options, each with a guarantee around the value on maturity of the plan. Depending on the investment options chosen, customers can hold the plan for a fixed term of a minimum of five and maximum of 10 years.
During this time it cannot be cashed in and when the plan matures, the customer uses their remaining pension fund to buy another retirement product, allowing them to reassess their circumstances at that point.
As the UK population ages and finances are squeezed, individuals approaching retirement are increasingly considering working past the traditional retirement age, and taking ‘part-tirement' is becoming more popular. The Fixed Term Retirement Plan helps to meet the changing needs of many people transitioning into retirement, offering a more flexible alternative to a conventional lifetime annuity.
Clive Bolton, at retirement director at Aviva, said:
"The Aviva Fixed Term Retirement Plan offers some great advantages. By investing for a fixed period of time, customers know they will have the chance to reconsider their financial needs and requirements in the future, and make a further decision on how to best use their pension fund at that point. It's a happy medium that's suitable for those who want some flexibility, as well as an element of certainty.
"We know through our customer research and regular Real Retirement Reports that the retirement market is changing rapidly. No two people are alike and individuals are approaching retirement with very different ideas about how they'd like to spend their life after work. We're responding to these changes by expanding our range of retirement solutions, offering increased choice and flexibility to customers."
Aviva offers a full range of retirement solutions, including conventional and enhanced annuities, standard and phased drawdown, the Fixed Term Retirement Plan and equity release.
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