Individuals in drawdown oblivious to flexible income

Pension provider Zurich2 has found that the majority of retirees taking an income in drawdown are unaware that they can reduce or even stop their withdrawals, meaning that they risk taking unsustainable levels of income that may not see them through retirement.


Despite flexible income being one of the perks of drawdown, meaning that retirees can tailor their withdrawals to their spending, a YouGov survey commissioned by the provider has revealed that 52% of over-55s in drawdown are completely unaware of this fact.

Unsurprisingly, awareness levels were shown to drastically increase among those who had sought professional advice. While 77% of those receiving ongoing financial advice were aware they could vary their drawdown income, a worryingly low 35% of those not seeing an adviser knew about this benefit.


Being in the dark about this key detail could be dangerous; if stock markets fall, unsuspecting investors are at risk of draining their pension pots. Not to be confused with ‘pound cost averaging’, this is called ‘pound-cost-ravaging’, and occurs when individuals find themselves having to sell more investments to maintain unsustainable levels of income. We can help you to understand how your drawdown savings work to ensure they last through your retirement.

2Zurich, June 2019

A pension is a long-term investment. The fund value may fluctuate and can go down. Your eventual income may depend on the size of the fund at retirement, future interest rates and tax legislation.