Drawdown less sustainable than scheme pensions

Rowanmoor Pensions points out advisers need to warn clients taking out the maximum amounts as defined by the Government Actuary’s Department (GAD) could reduce their income as the value of the fund falls. It warns once the income levels exceed the return on the underlying investments then the fund value will fall and the longer the retiree lives the chances are greater that the income will have to reduce. David Seaton, director of Rowanmoor pensions says for example in an Alternatively Secured Pension (ASP), drawdown after the age of 75, the maximum level of drawdown is 6.93%, which with...