William Burrows: Drawdown - good, bad or indifferent?

Three ways to judge a drawdown plan

clock • 5 min read

Drawdown is the new default for those taking income from their pension pot so, on the second anniversary of pension freedom, William Burrows lifts the bonnet and takes a look at what is powering the engine

There are many different ways of arranging a drawdown plan. Different levels of income, investment strategies and charging structures all mean it is very hard to compare drawdown plans and begs the question: How can advisers and their clients judge whether a drawdown is good, bad or indifferent? Working out what is happening inside a drawdown plan may be harder than first imagined. In the days before pension freedom, it was good practice to benchmark drawdown against annuities - for instance, over the long term, would drawdown pay out more income than an annuity? This comparison might ha...

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