William Burrows

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How much income?
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How much income can I take from drawdown - I want to have as much as I can but I don't want to run out of money quickly

Are there any guidelines about how much income to take?

Thanks



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Billy

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Good question - As you probably know there is no limit to the amount of income you can take so you can take anything from 100% of the fund to zero and don't forget all income (over and above the 25% tax free amount) is taxed at your marginal rate.

There are some guidelines about how much income you can take and this is known as "sustainable income" or "safe withdrawal rates" - the most common rate is 4% of the fund and increasing with inflation but with uncertain investment returns and low interest rates this might be too high and 3 - 3.5% may be more suitable.

The level of sustainable income will depend on your age so older people can take more than younger people - you can always use the income from an annuity as a benchmark

Please see https://www.williamburrows.co.uk/retirement/pension-drawdown/sustainable-income for more information



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