Question: I have been advised by a broker friend that I should tell my clients to temporally stop or reduce withdrawals of Income Drawdown Funds, if the markets suffer another sever correction. This will avoid their pension capital being eroded. What are the negative aspects of such a move and what can you recommend to remain with the fund?
Answers: Fiona Tait - Scottish Life If your friend that your clients should stop or reduce their income because they are also reducing their spending then this would certainly be a good strategy, however the main consideration is still likely to be the client's actual need for income. Generally I would advise that unless they intend to reinvest it the client should withdraw the minimum amount of income they need to meet their financial requirements at all times. This leaves the money they don't immediately need invested in a tax efficient environment. As a result it may be difficu...
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