Blended Drawdown and Annuities

Drawdown or Annuity or both?

How you fund your retirement is your choice and there’s more than one way you can take your pension. Did you know that you could combine your retirement income products so you can have both flexibility and security? You don’t need to feel restricted to just one product, it doesn’t have to be an either/or decision.

Your pension drawdown gives you the flexibility to enjoy your retirement your way, but your pot might not last for as long as it needs to. And whilst leaving it invested gives it more chance to grow, as with any investment, there's a chance it could go down in value too.

Whereas, having a guaranteed income for a fixed term means you always know what you have coming in to cover the essentials. Guaranteed income can come in different sizes, you could take a Lifetime Annuity which will guarantee you an income for life or a fixed term plan which can buy you a guaranteed income for between three and 25 years. With all guaranteed income options once started you can't cancel them.

More and more people are using both a drawdown product and an annuity together.

For example, if you move your pension pot into drawdown and start by taking your 25% tax-free cash. You then have the flexibility to drawdown further lump sums as and when you need them.

You then decide that you want the security of a guaranteed income to pay your regular bills, so you use 60% of your remaining drawdown pot to buy a guaranteed lifetime annuity and leave the remaining 40% in your drawdown pot to use when you need it.

Ready for a personalised annuity quote?

You can get a personalised annuity quote online, which will:

Give more details on what you’d get with us

Tell you if you could get a better rate elsewhere

Remember: The choices you make may affect your income for the rest of your life, and with annuities products you can't change your options later. We strongly recommend seeking financial guidance or advice.

Retirement guidance

Pension Wise from MoneyHelper

The government’s free and impartial service, offering guidance to make money and pension choices clearer.

To find out more or book an appointment online click below or call.

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You usually need to pay for their service and in return they recommend how to make the most of your pension given your circumstances.

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