Pensions - Articles - Zurich comment on LTA, annuities and savings

 On savings: 

 'We welcome the Government's continued encouragement of savings, including the new ISA flexibilities'.

  

 On annuities:
 'Opening the new pension freedoms to people currently drawing their retirement income from an annuity will allow existing pensioners to potentially take advantage of the reforms. There are practical considerations which will need to be worked through and both the industry and Government must do all they can in supporting people to make well informed choices with their hard-earned savings by providing appropriate information to consumers'.

  

 On the changes to the pension tax allowance:
 'Stability is especially important with long-term decisions like pension savings. While we recognise that UK plc needs to balance its books, it is disappointing that the lifetime tax allowance has been targeted again with a reduction to £1 million, creating more uncertainty for savers. It is important to remember that the length of retirement is increasing as people live longer so we should be encouraging people to save more. We had also warned that lowering the threshold could end up impacting on middle earners, not just higher earners, especially given the effects of inflation on savings over a long period. Although the Chancellor has said that the lifetime tax allowance will be index linked from 2018, this will only partially mitigate the impact of this change for savers who have been doing the right thing for their retirement'.