Unsecured Income

Question 1

What is a ‘Capped Drawdown Pension’?

Answer 1

A capped drawdown pension is a way of accessing pension funds by taking a limited income each year. The limit is based on the Government Actuary’s Department’s (GAD) rates.

The pension pot is invested into funds that pay an income.

The income is taxable and can vary depending on the fund’s performance.

The maximum income is reviewed every three years for those under 75, and annually for those over 75.