Income drawdown is set for a rise in popularity, with the latest news on annuity rates looking bleak for the future, income drawdown could get incredibly popular. There have already been some announcements regarding two new types of income drawdown:
- Capped drawdown
- Flexible drawdown
According to leading expert William Burrows:
Two new types of drawdown are to be introduced regardless of age
- Capped drawdown – available to everybody although the maximum income available will probably be lower than the current 120% of the GAD limit
- Flexible drawdown – provided a Minimum Income Requirement (MIR) is met there will be no limit on the income that can be taken
Currently income drawdown favours those with much larger funds and whilst this will probably be the same going forward it is thought that the new rules will also help those with smaller funds have greater flexibility.