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   Is Income Drawdown a ticking time bomb?


       

 

IMPORTANT NOTICE:

 

Following the dramatic relaxation of the Drawdown rules in the 2014-15 Budgets, large parts of the retirement planning field is likely to take new directions or at least be reviewed.

 

As a number of the specific details are as yet to be clarified it is suggested that you contact NFA directly for a FREE discussion of how these changes may affect your retirement plans!

 

Phone: 01603 452686

 

  -----------------

Parts of the sections below were based on an article by Helen Morrissey appearing in the professional Magazine: Retirement Planner on 22 May 2012 and is now largely obsolete following the 2014 Budget changes!

 

Income drawdown has been an important part of many people's retirement planning since it was first introduced in 1995.

 

However, recent issues such as volatile investment markets and the decrease in maximum income from 120% to 100% GAD, coupled with decreasing gilt yields, are having a big impact on the amount of money many people can take from their funds.

 

For details of the new 2012 drawdown rules  Read More...►

 

So what is the outlook for the income drawdown option at this most difficult time?

 

It is obvious that many people are disappointed, and concerned to see a decrease in their income due to the changing nature of Government legislation.

 

So what are the options available to you if you are facing a sizeable drop in your income?

 

One possibility is to look to secure your income by annuitizing. Another avenue may be to choose to maintain your present level of income by going into flexible drawdown if you qualify for this option,

 

Yet another possibility is to explore the option of remaining in capped drawdown and either making up the shortfall in income by using other assets or suspending, or reducing, withdrawals from your drawdown funds for the time being.

 

It deserves to be mentioned that there are arguments against annuitizing in the current economic climate. Thus, people who choose to annuitize now may potentially be doing so at the wrong time, as they in principle could be crystallising their losses. It may be the case that it would be better for you to remain in income drawdown.

 

However, such decisions can only be made once your overall situation has been analysed and discussed in detail. 

 

At least there is one advantage of income drawdown which is that you are still in a position where you can change between options if need be.

 

With almost daily market turmoil and ever-changing Government legislation it is now more important than ever to have a clear strategy for the way ahead for your pension provisions.

 

Only by getting things right from the start and carrying out regular reviews can new potential risks be identified and the most nasty of surprises be avoided.

   
 

Topical Issues

 
 

I don't want to retire right

now - maybe next year, or

the year after...

But, can I afford to cut down

on my work hours already?

     find out more 
 

Is it a good idea to buy an

Annuity now or is it better

to wait?

Should it be a single or a

joint annuity?

     find out more 

 
retired couple

What is the right way to

arrange my Investments?

How much risk can I

afford to take?

How much income can I get?

     find out more 
   

 
   

     

 

 

 

    Specialist Advice Areas


     Regulatory and Legal changes

    LONG TERM CARE -  

  BE PREPARED...

Long Term Care is an issue that most of us would rather not think about. But should you, or your loved ones, need it later it can be VERY expensive if you have not prepared.

      Read More...

WHAT WILL I GET

FROM THE STATE?

Although you may be entitled to a full or partial State Pension it is important that you also get to know what other benefits and support you may be entitled to in your later years.  Read More...

WHAT ARE POWERS OF ATTORNEY?

Not very many people are aware of what Powers of Attorney really are or How they Work? You need to know that they In many cases can be of critical importance in a difficult situation.  Read More...►

 

 PENSION CHANGES 2014

 
 

New rules allow increased flexibility for pension drawdown arrangements. But there are important aspects which need consideration.

   

   Read More...►

 

LET YOUR MONEY WORK FOR YOU!

   

 

 

 

 

 

 

VISIT THE DEDICATED NFA INVESTMENT SITE

►►

You are always Welcome

to contact NFA for a free discussion

of your Income Drawdown plans.

 

Phone: 01603 452686

 

 

e-mail: info@norwichpensions.co.uk

 

 

 

 

 

Norwich Financial Advice Limited  is authorised and regulated by the Financial Conduct Authority

and is entered on the FCA Register under FCA reference: 706645

Norwich Financial Advice Ltd. is registered in England and Wales; Company No. 8533929.  

Registered office: 74 Muriel Road, Norwich NR2 3NZ, Norfolk, England.