Norwich Union is recommending intermediaries conduct at least semi-annual reviews of Sipp portfolios...
Norwich Union is recommending intermediaries conduct at least semi-annual reviews of Sipp portfolios in today's volatile market conditions.
The group's divisional pensions development manager Alan Wells said regular updating is crucial because the fluctuating markets could change the amounts Sipp investors are allowed to withdraw annually through income drawdown plans.
Volatility may quickly alter the amount investors may wish to take from their portfolios, he added, particularly as the speed at which markets move against or in favour of the individual asset class has increased.
So-called GAD levels calculated by the Government Actuary govern the maximum and minimum amounts Sipp holders can draw down from their portfolios annually. These levels are based on single life annuity levels and prevailing interest rates.
Malcolm Gordon, national development manager at Sippdeal, estimated the GAD limits may have provided a maximum of 8% fund drawdown three years ago. He warned Sipp managers could see that level of drawdown be reduced significantly, given falls in portfolios.
Putting the tech into protection
Square Mile’s series of informal interviews
Fallout from Haywood suspension
Launching later in 2019
£80bn funds under calculation