Income Drawdown
Personal Pension for Income Drawdown
Another option available to clients whose circumstances may not suit immediate annuity purchase is that of income drawdown (sometimes referred to as Pension Fund Withdrawal).
Your client may choose to take a tax-free cash sum and leave the balance of their pension fund invested in the wide range of Scottish Widows funds available to drawdown customers. They can either take no income or taxable income withdrawals from their pension fund until such time as they choose to purchase an annuity. If they choose not to take their tax-free cash sum at the beginning, they can't have it paid to them at a later date.
There is an upper limit to the amount of income your client can take each year.
Income drawdown allows your client to defer the purchase of the annuity until a time that suits them, while their fund to continues to be actively invested.
As with the phased retirement option, the eventual benefits will depend on future annuity rates and investment returns.
Therefore, income drawdown is also likely to be better suited to those investors who are not totally, or even mainly, reliant on their pension fund for an income during retirement.
Income Drawdown to Income Drawdown Transfer
As one of the leading drawdown providers, Scottish Widows could be an ideal choice if your client is considering transferring from their existing provider.
With no establishment fee or exit penalty, a broad range of funds and a dedicated administration and support team, our Income Drawdown plan is an attractive option for your client.
Further Information about our Retirement Income Products
For further information on Scottish Widows Income Drawdown offering, our Product Comparison and Product Guide (pdf 183k)
and Unsecured Pension - A guide for financial advisers (pdf 648k) pages may prove useful.
