Income withdrawal (also sometimes referred to as "drawdown") has become a popular way of drawing pension benefits.

 

When a pension fund is transferred into income withdrawal tax-free cash can be released, up to 25% of the value of the pension.  The remaining pension fund is then invested for income and growth and is is used to provide a regular income for the policyholder at a level he or she chooses.  There are maximum limits to avoid the pension fund being quickly run down.

 

If you would like to know more about income withdrawal, Contact Us or use the Enquiry Form.

 

Income withdrawal tends to be attractive to the following individuals.  Those who :

 

• Do not wish to give up their pension fund by the purchase of a pension annuity
• Wish to release tax-free cash but take no income just yet, saving up more for the future
• Are currently higher-rate taxpayer who expect to fall into the basic rate in future years
• Wish to control how their pension is invested
• Are prepared to take some investment risk
• Have other sources of income

 

Income withdrawal will only be beneficial to the investor if the investment of the income withdrawal pension fund

• Matches the investors attitude to risk
• Is well structured
• Is well managed
• Funds perform well in the long-term
• Sufficient investment yield is produced by the funds as well as capital growth

 

We find may income drawdown investors have good contracts but are invested in the wrong funds.  Often they are suffering investment losses that need to be reversed to ensure their income is secure in the long-term.  If you feel you might be in this situation, please Contact Us for a free initial consultation.