Using drawdown to provide a sustainable income

by Patrick Norwood and Richard Hulbert
Insight Consultants

September 2020

The current climate has further highlighted the need for advisers to take a more tailored approach to clients’ investments. It is not uncommon for advisers to recommend investment strategies designed for accumulation to clients in need of income.

This CPD accredited guide, which is split into two parts, covers the advice process and examines the retirement support and solution offered to advisers by Royal London.

Specifically, there are two key areas discussed:

1)      Attitude to risk (and capacity for loss) questionnaires

Accumulation questionnaires are unlikely to sufficiently consider sequence risk or income sustainability.

2)      Investment strategies

Accumulation strategies focus on maximising returns for a given level of expected total return volatility. Decumulation strategies focus on achieving income sustainability over the duration within a defined level of confidence, subject to a certain level of sequence risk and withdrawal rate.

This document is full of key facts and tips to help advisers research and provide compliant recommendations, and is accredited by the CII/PFS and CISI for up to 60 minutes of structured CPD.


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