Pru: Advisers should not discount drawdown

The pension business development manager thought it would be unlikely new clients will suffer significant losses in the future compared to long- term investors experiencing June's rate of 2.25%. Simmons said: "If you buy drawdown now, you're buying in when rates are low. So while that will give you a low starting income - it has reduced the amount of risk the client will face." He believed if clients bought in today, gilt yields could potentially be higher in three years' time. He predicted improved confidence in Europe, which would produce better investment markets. "For new clien...