Flexibility will be vital in 2010 - Rowanmoor

The flexibility of SIPP and SSAS will increase their popularity as the Government cuts back on pension tax relief, according to Rowanmoor Pensions.

Making its predictions for the pensions market in 2010, Rowanmoor says family SIPPs, scheme pension and increased regulation will be keys themes in the coming year.

Rowanmoor's managing director, Ian Hammond, says member directed options will become increasingly important as investors seek flexibility in their pension.

He says the defined benefit SSAS structure is likely to become increasingly popular after the Government opted to freeze the lifetime allowance.

Family SIPPs are set to increase in popularity, according to Hammond, and new entrants to the market are expected in 2010.

Alternatives to traditional annuities and income drawdown will become more widely used, adds Hammond.

"Interest in Scheme Pension as the alternative to traditional forms of pension income will continue as interest, annuity, maximum unsecured pension and alternatively secured pension rates will all continue to run at very low levels," he says.

Regulatory interest in SIPPs is also likely to increase, according to Hammond.

He adds: "Whilst there has been increasing focus on SIPPs, from the FSA, yet more clarity is needed; whilst it is unlikely that we will see action in the short term, more measures must be taken by the regulator to clarify SIPPs for the consumers, to enable them to make a more informed decision."

Rowanmoor Pensions says 2010 will be a challenging year for clients, providers and advisers, but believes flexibility will allow investors to adapt to whatever lies ahead.