This additional flexibility is reflected in the name of all new pension drawdown contracts entered into since the April 2015 pension freedoms: they’re referred to as ‘ flexi-access drawdown‘.įor the vast majority of people and pension schemes, you have to be 55 before you can access your pension in any way, including through pension drawdown. With annuity rates currently at historic lows as a result of economic and demographic pressures increasing costs for annuity providers, income drawdown may also be able to offer you a larger pension than an annuity depending on your circumstances. ![]() Pension drawdown could allow for that growth going forward. Income drawdown offers a far more flexible way of accessing your pension when compared to an annuity because it effectively allows you to dial up and down your pension income as required.Īlso, once your savings are locked up in an annuity, there’s no chance for investment growth in the future. ![]() In fact, the way pension drawdown is taxed is the most complicated part of taking your pension this way. Moving the cash into drawdown is generally quite straightforward, but it’s vital you get the initial process right as this could have tax implications later on. Once the funds are in drawdown you can create your own flexible schedule of payments, either investing the capital to generate an income or withdrawing ad hoc lump sums as required (or a mixture of the two). The way pension drawdownworks is relatively simple - at retirement you opt to designate your pension savings to drawdown.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |