Income drawdown
Income drawdown is an alternative to an annuity. It allows you to draw an income directly from your pension whilst the fund remains invested.
Income drawdown is more flexible than an annuity as it allows you to keep control of your investments and choose the level of income you draw (within limits). It also allows you to bequest the remainder of your pension subject to a tax charge. However, it is a more risky strategy than an annuity.
Benefits
• Retain control of your pension
• Decide on the income level to suit you (within limits)
• There is the potential for rising income, if investments grow ahead of withdrawals
• Unused funds can be bequeathed on death (net of a tax charge)
Drawbacks
• Poor investment returns and/or excessive withdrawals can deplete your pension pot
• If your pension value falls, the amount of income you can take in the future may be reduced
• There is no guarantee that you will always be able to withdraw an amount equivalent to an annuity
Why Protection & Investment?
Income drawdown is a complex subject which requires a deep understanding of pension rules and investment portfolio theory. It is also vital that income drawdown plans are reviewed regularly.
As specialists in retirement and investment advice, we will help establish your income needs in retirement and recommend the most suitable options for you. And, if drawdown is right for you, we will combine our understanding of the pension marketplace with our knowledge of investments to put in place a retirement income strategy. Plus we will review your plans regularly to ensure they remain on track.
If you are interested in income drawdown please contact us
We also offer advice on:
“ Having met three different IFAs in the Andover area, I chose Neil to give my wife and I financial advise as he was the only IFA that didn’t pre-judge our circumstances and took the time to visit us at home in the evening. We’ve been very happy with the support and advice we have received from Neil and would not hesitate in recommending him to our family and friends - Nick & Vicky, Andover ”
