7 tips to compare drawdown providers

By Kirsten Hastings, 19 Feb 18

The number of providers offering drawdown has gone up since the pension vehicle was first introduced in the UK in 1995, but differences in quality of service and charges can be substantial, warns Hargreaves Lansdown, which has offered seven tips to compare providers.

1. Check where you can invest

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Drawdown allows investors more flexibility with their pensions.

Each time you move money into drawdown (bear in mind you don’t have to move all your pension in one go), up to 25% can be taken as a tax-free lump sum.

The remainder stays invested and taxable income can be drawn directly from the pension as you wish.

When deciding which provider to use, make sure the investments you want are available and that you can invest in a way that suits you.

Also, remember all investments can fall or rise in value, so you could get back less than you originally invested.