Income Drawdown Option

Income Drawdown Section Introduction – Pensionfinder









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    Income Drawdown Section Introduction

    Is Income Drawdown A Viable Option For You?Income Drawdown Introduction

    Income drawdown is as complex as is it flexible so although it does offer pension holders a range of options, it can also be quite confusing. The biggest plus points with this form of investment include growth potential, the fact that it allows you complete control over your pension as well as the option to leave the money to a spouse or beneficiary should you die before the age of 75.

    It needs to be noted however that there are also some large minus points. These articles are not designed to make the choice for you but they are written to provide useful information which hopefully will enable you to make an informed decision on what the right choice is for you. Remember, this information is not professional advice. There are numerous different options which are dictated by each individual’s circumstances so it is impossible to definitely state that a certain plan is the right one. Therefore, you must be prepared to visit a financial advisor in order to make the most prudent decision.

    The Financial Services Authority (FSA) is the financial regulator in the UK and advises pension holders to seek all the professional advice they can about income drawdown because they believe it to be an exceedingly complex option. Professional advisors are there for people who cannot make a decisive decision regarding their pension.

    Continue reading if you:

    • Ÿ  Are about to retire or are nearing the age of retirement
    • Ÿ  Have a relatively large pension pot which gives you extra investment options
    • Ÿ  Realise that income drawdown and all investments could result in your pension value falling as well as rising

    The Articles in this section will tell you:

    • Ÿ  The basics of income drawdown
    • Ÿ  All you need to know about Alternatively Secured Pensions (ASP)
    • Ÿ  Commencing income drawdown using your HL Vantage SIPP
    • Ÿ  The risks involved

    How you can get information specifically designed for your circumstances

    Options

    Along with your home, your pension is the most important investment you will ever make and in some cases will exceed the value of your home. Therefore, when you make a pension income decision it must be the correct one. The most basic choices are annuities which can provide a steady and secure income. Income drawdown on the other hand is neither steady nor secure but it can provide a much higher return on investment.

    Here are the basic retirement options:

    • Ÿ  Secured Pension: Also known as lifetime annuity
    • Ÿ  Unsecured Pension: Another name for income drawdown which can be utilised up until you are 75
    • Ÿ  Alternatively Secured Pension: An ASP is effectively another means of continuing your income drawdown once you turn 75. The main differences between the two include greater restrictions on death benefits and income
    • Ÿ  Phased Retirement: An increasing number of people would rather not be forced to take all their benefits upon retirement. With phased retirement, it is possible to take your benefits in increments with income drawdown and annuities two of the options available to you