There are a wide number of providers of income drawdown, with differing charging structures and features. Below is a list of some of the most well  know drawdown providers:

 

AIG Life AXA Clerical Medical Friends Provident GE Life Legal & General Norwich Union

Prudential Scottish Equitable Scottish Widows Standard Life Skandia Winterthur Life Zurich

Income Drawdown and Plan Charges

The minimum amount companies will accept into an income drawdown contract varies. Most set a minimum amount of around £100,000, although there are some which will accept amounts of £50,000. There are however one or two who have no minimum amount.

The best company for you will depend on your circumstances and your requirements. Some contracts are cheaper than others, but this comparison can be very difficult to make, since their charging structures vary, and the way the cost of advice is covered may vary from company to company. Even the same contract with the same company can be set up with a differing charging structure.

Charges should not be the only consideration. There are others points to consider when considering an income drawdown provider:

Income Drawdown and Fund Choice

Some providers offer more fund choices than others. If you have an old income drawdown contract you may find that you only have access to a limited number of funds. New contracts can vary widely in the choice of funds. Most now however offer some external fund links, which are funds managed by an external fund management company, such as Fidelity, Invesco Perpetual, Schroders, etc. 

Some income drawdown providers offer a limited number of funds whereas others offer up to a 1000 funds from a number of different fund managers. However of the 1000 funds there are probably a large number which most investors would never choose, and those that offer less funds are generally more selective in choosing the funds they offer.

Different funds also come with different charging structures. Externally managed funds tend to have higher annual charges, compared to the insurance companies own funds. People who invest in the external funds would hope that they provide better performance than the internal funds. But you do need to remember that the higher the charges, the greater the level of growth you require to beat the maths compared to buying an annuity. For more information on fund strategies and the effect of charges click here to read more details on income drawdown.

Income Drawdown and Self Invested Personal Pensions (SIPP)

If you want weird and wonderful funds, the widest selection of funds and investment choices then you would probably be better off with a SIPP. This enables you to invest in a wide variety of investments, even commercial property.

Even insurance companies offer SIPPs as their income drawdown product, or as an option within their standard product. Alternatively you could opt for a specialist SIPP provider especially if you're looking at a commercial property purchase or a investing in more specialist investments.

Generally speaking a SIPP tends to be a more expensive products to use as an investment vehicle for an income drawdown product. So you need to weigh up the extra cost of the SIPP and whether you currently need the added flexibility.

If you have a question about income drawdown or want to discuss drawdown in more detail and how it can benefit you then contact us online or phone 0800 011 2713 , or click on the links below to find out more.

Income drawdown - the details

Unsecured Pension - if you want to know more about the options for those under 75

Alternatively Secured Pension -  if you want to know more about the contract for those over age 75

Don't take any chances with your pension, your retirement will depend upon it, talk to an independent pension specialist now