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Annuity holders still need to consider options carefully after Budget announcement, says Wesleyan

Commenting on the latest reforms to pensions announced in today's Budget, Alan Jones, Managing Director of Wesleyan Financial Services, said:

Annuity Freedom
"From April 2016 it is likely people will be able to sell their annuity to a third party. This announcement will be welcomed by those people who had already bought an annuity, but felt they had missed out on the freedom and flexibility that will be available to pension savers from next month (April 2015).

"However, anyone tempted to cash in their annuity must consider their options carefully and seek expert professional advice as this is a decision that will have implications for the rest of their lives.

"People work hard throughout their career to build up funds for retirement and while taking a lump sum might be appealing in the short term, they also need to ensure they will continue to have money available to support the lifestyle they want into the future."

Lifetime Allowance Reduction
"The reduction in the pension Lifetime Allowance to £1 million from £1.25 million from April 2016 could have further implications for high net worth customers who are already facing one of the biggest overhauls in pensions in a century.

"While £1 million may seem like a lot of money to save for retirement, it is possible for some high earners, such as hospital doctors who have been members of the NHS Pension Scheme for a long time, to reach this amount well before they are in a position to retire.

"It is important pension savers check how much they have accumulated, or expect to have accumulated, before the changes come into effect next year. There will be a number of options available, including stop paying into a pension fund, and using an ISA instead, but it is vital to plan accordingly and take expert financial advice."

'WESLEYAN’ is a trading name of the Wesleyan Group of companies.

Wesleyan Assurance Society and Wesleyan Bank Ltd are authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Wesleyan Financial Services Ltd, Wesleyan Unit Trust Managers Ltd, Practice Plan Ltd and DPAS Ltd are authorised and regulated by the Financial Conduct Authority.  Advice about investments, insurance and mortgages is provided by Wesleyan Financial Services Ltd.

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