Legal & General has revamped its Executive Pension Plan to clearly differentiate this product from s...
Legal & General has revamped its Executive Pension Plan to clearly differentiate this product from stakeholder pensions.
Key changes to the plan involve increasing minimum regular contributions to £250 per month, or £2,000 per year, from the previous level of £75 each month or £750 per year.
The amount of contribution allocated to units has been improved for regular and single contribution plans where the adviser takes level or no commission.
The minimum term for the plan has been increased to five years from three. The changes, introduced at the end of February, apply to new customers only. Existing customers will retain the original terms of the agreement.
The annual management charge of 0.5% pa remains the same, as does the initial charge of 5% bid/offer spread. The monthly plan charge is also the same at £5 and the minimum single contribution stays unchanged at £7,500.
Andy Agar, pension marketing director at Legal & General, said: "We have made the key changes and improvements to our Executive Pension Plan to clearly differentiate it from a stakeholder product, which is likely to become the favoured product for those customers at the lower contribution end and of the current executive pension market.
"The introduction of stakeholder puts clear blue water between the vast majority of customers who seek a plain vanilla pension such as stakeholder and those who required a more sophisticated pensions vehicle."
Agar said, Legal & General believes that products such as its Executive Pension Plan, suitable for high earners using them for business tax planning purposes, will become an even more important source of income and profit both for adviser and providers in the futur.
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