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Article: Drip, drip, drip ...(On using income drawdown)
- Article from:
- What Investment
- Article date:
- October 1, 2000
- Author:
CopyrightCOPYRIGHT 2000 Vitesse Media. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan. All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)
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A useful tool for retirement planning or a nightmare waiting to happen? Jim Hawkins looks at how to use income drawdown to your advantage
Until 1995 those with personal pension plans only had one alternative on retirement - to buy an annuity, which guaranteed an income for life. Not a very inspiring option.
However, low annuity rates have forced a change, and since 1995 income drawdown has made its way onto the pension shop shelf.
An income drawdown investment is a pension arrangement that you can make use of between the ages of 50 and 75. It allows you to take your maximum tax-free cash at the outset and defer your annuity purchase until the ...