Drawdown

[Mkdoor]

Hi All,
How easy is it to do drawdown after you have taken your 25% tax free lump sum can you do it without having to use a financial advisor.

[LeoSayer]

Very easy if you have the right platform.

I've used AJ Bell (SIPP), II (SIPP) and LifeSight (DC Pension) and all have been pretty hassle-free although there is a bit of online form-filling to be done. No financial advisor required.

Depending on the platform you may need to raise cash in advance of the drawdown/TFC or instead tell them what to sell.

[Arrivalist]

Mkdoor said:

Hi All,
How easy is it to do drawdown after you have taken your 25% tax free lump sum can you do it without having to use a financial advisor.

Yes you can but some will continue to ask if you’ve had advice or at least spoken to Money Wise.

Exactly how easy depends on who your drawdown is with. Some make you answer multiple questions each time, others allow you to do it entirely online.

[alscar]

Depends on the provider ( some are painful to facilitate this with apparently ) and also I believe the quantum of pot size can play a part.

[Mkdoor]

Hi thanks for your quick replies both me and the Mrs with Metlife and Royal London

[croyde]

Thread of interest.

I've only today finally had all my pots transferred to an interactive investor Sipp Account.

I've just asked via secure message for my tax free lump sum and will be reinvesting the rest.

They also gave me £200 free into an investment account for using them. That account looks pretty easy to take cash and move it into my bank account but I've not yet looked into how the Sipp will work in drawdown.

[mike13]

croyde said:

Thread of interest.

I've only today finally had all my pots transferred to an interactive investor Sipp Account.

I've just asked via secure message for my tax free lump sum and will be reinvesting the rest.

They also gave me £200 free into an investment account for using them. That account looks pretty easy to take cash and move it into my bank account but I've not yet looked into how the Sipp will work in drawdown.

Hope you have better luck than me Croyde, I left them due to their poor service, I only got resolution after posting a 1 star review on Trustpilot.

They contacted me by phone and gave a small amount of compensation due to a customer advisor refusing to let me speak to a supervisor after he gave me wrong advice

After trying a second time for drawdown, they eventually told me I can’t do this using safari, having tried 3 times filling out the drawdown form and it then coming up with an error message.

They take 5 days to answer the message service, their website is frequently down due to maintenance, moved to Vanguard, had no issues with them.

[Mkdoor]

Hi thanks for your quick replies both me and the Mrs with Metlife and Royal London

[croyde]

mike13 said:

Hope you have better luck than me Croyde, I left them due to their poor service, I only got resolution after posting a 1 star review on Trustpilot.

They contacted me by phone and gave a small amount of compensation due to a customer advisor refusing to let me speak to a supervisor after he gave me wrong advice

After trying a second time for drawdown, they eventually told me I can t do this using safari, having tried 3 times filling out the drawdown form and it then coming up with an error message.

They take 5 days to answer the message service, their website is frequently down due to maintenance, moved to Vanguard, had no issues with them.

Oh gawd

They've normally returned messages within 24 hours or less but maybe cos I'm a new customer.

But your experience is not good to hear.

[craig1912]

Mkdoor said:

Hi thanks for your quick replies both me and the Mrs with Metlife and Royal London

You may have an issue with Royal London as they deal exclusively with IFAs. I’m guessing you used one who placed you with them and presumably they are still receiving a fee?

Edited by craig1912 on Friday 17th July 08:30

[Mazinbrum]

mike13 said:

croyde said:

Thread of interest.

I've only today finally had all my pots transferred to an interactive investor Sipp Account.

I've just asked via secure message for my tax free lump sum and will be reinvesting the rest.

They also gave me £200 free into an investment account for using them. That account looks pretty easy to take cash and move it into my bank account but I've not yet looked into how the Sipp will work in drawdown.

Hope you have better luck than me Croyde, I left them due to their poor service, I only got resolution after posting a 1 star review on Trustpilot.

They contacted me by phone and gave a small amount of compensation due to a customer advisor refusing to let me speak to a supervisor after he gave me wrong advice

After trying a second time for drawdown, they eventually told me I can t do this using safari, having tried 3 times filling out the drawdown form and it then coming up with an error message.

They take 5 days to answer the message service, their website is frequently down due to maintenance, moved to Vanguard, had no issues with them.

I rely on drawdown with ii to live so very important to me, I've had no issues with ii though you do have to sell shares/units yourself to ensure there's enough cash in your SIPP for the monthly withdrawal.

[deanobeano]

ii user for me and the wife.

Been using them for 15+ years. They've been great! and I must have saved a fair bit over the likes of H&L etc.

Secure message normally gets you a response in 24 hours or so.

Have performed multiple drawdowns with no problems (once you understand how to complete the online forms!)

[ChrisH72]

Do most people draw money each month from their pension or is it easier to just take a lump say once a year?

I'm surprised to hear that it's not easy. I assumed it would be no different than taking money out of a savings account.

[croyde]

Well I guess as your pot should be invested, there'll always be hoops to jump through but if your money is sitting there as cash it must be like a bank account apart from the platform having to take off the tax, if any, owed.

[alscar]

Depends entirely on the type of Pension set up and the provider.
Mine couldn’t be simpler - I have a mtg once a year specifically to talk about my drawdown requirements for the next year and just combine that with my usual regular chat with my FA.
Money appears in the bank each month and I also get a payslip and confirmation slip showing what fund units sold and at what price.

[deanobeano]

ChrisH72 said:

Do most people draw money each month from their pension or is it easier to just take a lump say once a year?

I'm surprised to hear that it's not easy. I assumed it would be no different than taking money out of a savings account.

If you take 1 x large payment each year, then you'll most likely be taxed as if you're going to be taking that amount every month!
You can reclaim the tax back, but I think taking a monthly income is less hassle.

[alscar]

deanobeano said:

If you take 1 x large payment each year, then you'll most likely be taxed as if you're going to be taking that amount every month!
You can reclaim the tax back, but I think taking a monthly income is less hassle.

When talking dd the first time almost always you get put on and pay tax on an “ emergency code “ basis but in fairness this tends to get corrected by the next month so any reclaim per se is automatic.
At least that’s what happened to me.
Obviously if as part of your dd some is tax free the above can be compounded.
Most FA’s will say that if you take the lump sum route along with then the balance each year divide by 12 and put in the bank or wherever.

[Mazinbrum]

alscar said:

Depends entirely on the type of Pension set up and the provider.
Mine couldn t be simpler - I have a mtg once a year specifically to talk about my drawdown requirements for the next year and just combine that with my usual regular chat with my FA.
Money appears in the bank each month and I also get a payslip and confirmation slip showing what fund units sold and at what price.

You pay for that simplicity though, handsomely too.

[craig1912]

ChrisH72 said:

Do most people draw money each month from their pension or is it easier to just take a lump say once a year?

I'm surprised to hear that it's not easy. I assumed it would be no different than taking money out of a savings account.

Each month and it is easy. I receive a monthly payslip and updated valuations once a quarter combined with twice yearly meetings with my IFA.

[alscar]

Mazinbrum said:

alscar said:

Depends entirely on the type of Pension set up and the provider.
Mine couldn t be simpler - I have a mtg once a year specifically to talk about my drawdown requirements for the next year and just combine that with my usual regular chat with my FA.
Money appears in the bank each month and I also get a payslip and confirmation slip showing what fund units sold and at what price.

You pay for that simplicity though, handsomely too.

You’re right but only in respect of my overall charges which I’m ok with versus the returns which is how I look at this - the simplicity is “ free “ .
Fwiw the overall charges have also been reduced significantly over the last few years especially on the main Pension but again more than a simplistic platform yes.