All existing stakeholder pensions will have to change their default options to a fund with lifestyli...
All existing stakeholder pensions will have to change their default options to a fund with lifestyling incorporated into the asset allocation, according to the Treasury.
The changes are part of the Government's plans to fold existing stakeholder pensions into its wider planned suite of stakeholder products, known as the Sandler suite.
This inclusion means groups will now have to ask existing stakeholder members if they want to switch to a new default fund, creating an administrative problem for many providers, according to Nigel Stammers, head of industry affairs at Clerical Medical.
The lifestyle option means funds have to move from an equity allocation towards higher fixed interest weightings as the policyholder nears retirement.
The Treasury, in a document released this week, has firmed up some of its proposals for its stakeholder suite, ahead of its planned draft regulations to be released next year. In the paper, the Government said it will also look to rebrand Cat-standard cash Isas as part of the suite and will include the Child Trust fund once details of the product are finalised.
As reported in this week's issue of Investment Week, the Government has confirmed it is considering a change on the charging cap and has commissioned research on the subject.
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