A Pension Drawdown is a personal pension plan which allows you to access your pension to provide a variable income stream whilst keeping your pension funds invested and under your control. They have existed in various forms since 1996 but April 2015 heralded the biggest changes to pension drawdown products in a generation.
The April 2015 changes to pensions granted Pension Freedom to everyone – the right to access your pension from the age of 55 in the way that you choose.
New products have been introduced to reflect the new pension freedoms and now more than ever it is important to take regulated financial advice from experienced professionals to ensure you are making the right decisions for your future.
The main retirement providers are still in the process of launching their revised and enhanced new products including –
It is important to make sure you are taking advice from regulated and experienced professionals who are aware of all the latest products.
Many of the older types of pensions do not offer the new income flexibilities or death benefit flexibilities of the new Pension Freedoms, whilst others might offer valuable guarantees. Other than your home, your pension is most likely to be your most valuable asset, and it is outside of your estate from an Inheritance Tax perspective. The latest changes to pensions means that if you die before age 75 it is possible to leave your pension tax-free to your nominated beneficiaries.
If you would like to speak to a friendly advisor about Pension Drawdown, please call us free on 0800 03 04 008, or send us an email.
You can use our drawdown calculator to calculate how much income you can obtain from your pension pot.
Please note that the GAD calculator is only relevant for those already in Capped Drawdown and wishing to remain in it.
The drawdown calculator is free to use. We never pass on or share your details to any third party.
The value of investment and income from them may go down.
You may not get back the original amount invested.
THIS CALCULATOR IS FOR ILLUSTRATIVE PURPOSES ONLY.
The Pension Drawdown Company is an award winning Chartered practice. So what does it mean to work with a Chartered Financial Planner? What are the benefits? Watch our video below to find out:
This video is provided by the Chartered Insurance Institute (CII) and therefore neither The Pension Drawdown Company nor TenetConnect Limited are responsible for the content.
The introduction of the new freedoms means pensions have recently become a much more attractive savings option.
The Government has shaken up the rules that will affect everyone coming up to retirement and some already in retirement. These changes are due to take effect from April 2015.
In April 2015, the Chancellor will scrap the "punitive" 55 per cent rate on drawdown pension funds due when the holder dies. Dr. Ros Altmann, the pensions expert and Government adviser for older people, said: "This is another great piece of news for pension savers".
For the first time since he entered No11 Downing Street, the Chancellor of the Exchequer has been able to give a budget speech that contained some welcome news. Pensioners will be better off as they will no longer be required to purchase annuities and they will be able to draw down on their pension without risking incurring charges.
There are many different types of pensions, including Personal Pensions, Final Salary Schemes, as well as several others. Some key features of a pension include:
Buying a Pension Annuity means that you are converting your pension fund into an income that will be paid for the rest of your life. A Pension Annuity is a Secured Pension because the income amount is guaranteed for life, unlike a Drawdown plan which is an Unsecured Pension (USP).
A Pension Annuity can be purchased with the entire pension fund that is available or it can be from funds after the tax-free cash (usually 25%) that you are entitled to has been taken. The amount of income you are entitled to will depend on the Pension Annuity rate at the time of purchase. The Pension Annuity and its terms are fixed at the outset whereas a Drawdown plan allows you to vary the income payments.
It has been one of the best decisions in my life to entrust my 40 years of pension contributions to The Pension Drawdown CompanyMarcus Sheldon - Broughton-in-Furness, Cumbria (Retired IT Manager)