The changes announced by George Osborne in his 2014 Budget have turned established assumptions about pensions on their head.

Ever since personal pensions were introduced in 1988 for those who did not have the benefit of occupational schemes, a basic condition of tax relief has been that pension savings should ultimately be converted into a secure income, usually in the form of an annuity. That requirement is now to
be abandoned, with far-reaching implications for personal finance and the UK economy as a whole.

Disillusionment with annuities began in the early 1990s, when rate...

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