Drawdown flexible access to your pension
Take a variable income from your pension, whilst keeping it invested
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Important: The information on our website is not personal advice but we can offer advice if specifically requested. What you do with your pension is an important decision, which could be irreversible. Drawdown is a more complex option than an annuity. Make sure you understand your options and check they are suitable for your circumstances: take appropriate advice or guidance if you are unsure. The Government's free Pension Wise service can help. It provides impartial guidance face-to-face, online or by phone - more on Pension Wise.
Low-cost, flexible and accessible
If you're aged 55 or over and don't need secure income, drawdown can provide a flexible alternative with the potential to increase your fund value and income through investment growth. It allows you to take up to 25% of your pension as a tax-free lump sum up front and then a variable income from the rest, which stays invested. You choose where to invest and what income to take.
Drawdown offers more flexibility than a lifetime annuity, which provides a guaranteed income for life, but drawdown also carries considerable risks. You could run out of money if you take too much out, you live longer than expected or your investments perform poorly. If you invest without advice, the responsibility for these decisions rests with you. Find out more about drawdown and how it works »
To find out how much income you could take in drawdown, request your free personal drawdown illustration which will show you how withdrawals could affect your future income and how investment performance can change your fund value over time, all with no obligation to proceed.
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Request your free guide to Drawdown
Other terms for Drawdown:
- Flexible drawdown
- Flexi access drawdown
- Income drawdown
Benefits and risks of drawdown
- Take up to 25% as a tax-free lump sum
Even if you don't need the lump sum, you might consider using the tax-free cash to supplement income in a tax efficient manner, or keep some of the tax-free cash aside as a cash buffer. This would allow you to weather market storms and save having to sell investments at a bad time should you need income: having enough cash to cover your needs means you can wait for the market to - hopefully - recover.
Invest how you want
You have the flexibility to choose your own investments, let an adviser choose the investments for you, or use our ready-made portfolios available through our Portfolio+ service (this is not specifically designed for drawdown but at your disposal if you decide any of the portfolios meet your investment goals).
The value of investments can rise and fall. Poor investment choices or performance will deplete the fund leaving you short of income.
Choose your preferred level of income withdrawals
Choose how much income to take - if any - and start, stop or vary the amount you take out any time. Giving you the flexibility to vary your income to meet your needs, or keep within certain tax bands or allowances. You could even take your whole pension in one go if you wish.
Please remember, a pension is designed to provide an income throughout retirement. Income is not secure and excessive withdrawals will deplete the fund, leaving you short of income later in retirement.
- Death benefits
The remaining fund can be passed on to your nominated beneficiaries in the event of your death, tax free in some cases. Find out more.
What is the application process?
Step 2. Make sure you know the associated risks
You will also receive a set of risk questions which you will need to read through to ensure you are aware of the risks of drawdown. Confirm you're happy to proceed by calling us on 0117 980 9940 or returning your risk questions by post.
Step 3. Complete and return your application form
If you are happy to proceed, complete your application form and, if applying for drawdown with us for the first time, enclose proof of age documentation (such as a copy of your valid passport, photocard driving licence or birth certificate) to verify your age. Drawdown is normally only available to those aged 55 or above.
Why choose drawdown with us?
There is no drawdown set up fee, no transfer in fee and no charges for one-off or regular withdrawals, or for changing your income instructions. In fact, the only addition to our normal pension charges is an early closure fee for people who open and then close their account within a year. View our low charges, including annual management and dealing charges »
One of the UK's most trusted drawdown providers
More investors choose Hargreaves Lansdown to manage their drawdown plan themselves (without advice) than any other provider, making us one of the UK's most trusted drawdown providers.*
Awarded Best for Pensions and Pension Freedoms by industry body The Lang Cat in 2015. We won Gold Standard for Retirement in 2015 and were voted Best SIPP Provider by readers of What Investment for the past nine years running. In 2015 alone we won seven industry awards for our pension service.
Support if and when you need it
Our drawdown specialists are on hand to answer any questions. No automated service, just friendly, professional support. We also offer a national team of 85 advisers if you ever need advice.
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*Hargreaves Lansdown is the largest non-advised drawdown provider by number of clients (41 drawdown providers surveyed). Money Management survey September 2015.
Drawdown is an option that requires you to make an active investment choice and review investments regularly. Portfolio+ is not specifically designed for drawdown. Nonetheless our Portfolio+ range is available for drawdown investors who believe it meets their individual requirements.
Continue to Portfolio+