Flexi Access Drawdown

Spivo46

JSL_2 said:

So begining to understand exactly how Flexi Access Drawdown Works

So for every £1 of Tax Free Money you take from pot , £3 gets moved to Flexi Access Account and is only taxed when you make a withdrawal ?

My questions are -  

My pot is invested in Royal London Governed Portfolio 2,
Charges 0.4% and I also have Profitshare.
If I'm happy with the Governed Portfolio 2, Will the money which moves to Flexi Access after i take my Tax free sums, Still have the same charges and be included in Profitshare  ? 

I am in the same position as you with Royal London and moving into drawdown now. Can i ask why you have chosen GP2? I am in GP4. I will be doing the same as you, but taking 20k TFLS and 12k taxable. I have requested to only move 80k into drawdown and will leave 320k in GP4 Un-crystalised. The remaining crystallised 48k will be in the same investment portfolio

JSL_2

Spivo46 said:

JSL_2 said:

So begining to understand exactly how Flexi Access Drawdown Works

So for every £1 of Tax Free Money you take from pot , £3 gets moved to Flexi Access Account and is only taxed when you make a withdrawal ?

My questions are -  

My pot is invested in Royal London Governed Portfolio 2,
Charges 0.4% and I also have Profitshare.
If I'm happy with the Governed Portfolio 2, Will the money which moves to Flexi Access after i take my Tax free sums, Still have the same charges and be included in Profitshare  ? 

I am in the same position as you with Royal London and moving into drawdown now. Can i ask why you have chosen GP2? I am in GP4. I will be doing the same as you, but taking 20k TFLS and 12k taxable. I have requested to only move 80k into drawdown and will leave 320k in GP4 Un-crystalised. The remaining crystallised 48k will be in the same investment portfolio

Thanks for the feedback Spivo46 , the reason I'm in GP2 is when I done a review of my pension and investments back in 2018, as I was approaching 60th Birthday, my pension was not  doing much as was automatic geared for annuity , and was put if safe funds. I done the risk profiler and was rated 4 ( slightly cautious). that's where financial adviser decided was best for me. Was working out pretty decent until Covid, war, and the rest. You have a bit more in your pot than me, although I do have Cash and SS ISA's. I have been self employed Joiner for over 34 years, Last 8/9 years i have been working as sole trader and gradually moving into part time / semi retirement. most recently 2/3 half days per week. The work I was doing has changed and is 2/3 half days per month, so I find myself having to start using my investments a bit early. I am 15 months away from state pension.  I probably have about 6/7k to use up in this financial year, nex financial year will include 3 months state pension. Will probably break into my Royal London GP2 into next tax year. 
I would like opinions as whether RL GP2 is decent enough for a drawdown pot . If so thinking of going it alone to avoid Financial Adviser charges of 0.75% ongoing to manage my investments or fixed sum for review and set up.

Spivo46

JSL_2 said:

Spivo46 said:

JSL_2 said:

So begining to understand exactly how Flexi Access Drawdown Works

So for every £1 of Tax Free Money you take from pot , £3 gets moved to Flexi Access Account and is only taxed when you make a withdrawal ?

My questions are -  

My pot is invested in Royal London Governed Portfolio 2,
Charges 0.4% and I also have Profitshare.
If I'm happy with the Governed Portfolio 2, Will the money which moves to Flexi Access after i take my Tax free sums, Still have the same charges and be included in Profitshare  ? 

I am in the same position as you with Royal London and moving into drawdown now. Can i ask why you have chosen GP2? I am in GP4. I will be doing the same as you, but taking 20k TFLS and 12k taxable. I have requested to only move 80k into drawdown and will leave 320k in GP4 Un-crystalised. The remaining crystallised 48k will be in the same investment portfolio

Thanks for the feedback Spivo46 , the reason I'm in GP2 is when I done a review of my pension and investments back in 2018, as I was approaching 60th Birthday, my pension was not  doing much as was automatic geared for annuity , and was put if safe funds. I done the risk profiler and was rated 4 ( slightly cautious). that's where financial adviser decided was best for me. Was working out pretty decent until Covid, war, and the rest. You have a bit more in your pot than me, although I do have Cash and SS ISA's. I have been self employed Joiner for over 34 years, Last 8/9 years i have been working as sole trader and gradually moving into part time / semi retirement. most recently 2/3 half days per week. The work I was doing has changed and is 2/3 half days per month, so I find myself having to start using my investments a bit early. I am 15 months away from state pension.  I probably have about 6/7k to use up in this financial year, nex financial year will include 3 months state pension. Will probably break into my Royal London GP2 into next tax year. 
I would like opinions as whether RL GP2 is decent enough for a drawdown pot . If so thinking of going it alone to avoid Financial Adviser charges of 0.75% ongoing to manage my investments or fixed sum for review and set up.

I used an IFA back in 2017. They put me into Royal London GP1. I did not want the ongoing cost of the IFA so i went alone after the transfer. Last year i switched to GP4 as the returns were slightly better. It has an annualised growth of 4.4% (not bad considering world events). I have looked around but i think we are splitting hairs and i feel comfortable with RL, 0.4% management fees and the annual profit share is a bonus. I am coming up to 64 so drawing down a little early, but how much money do you need at 80 plus? Enjoy while you can - all the best

Linton

JSL_2 said:

Spivo46 said:

JSL_2 said:

So begining to understand exactly how Flexi Access Drawdown Works

So for every £1 of Tax Free Money you take from pot , £3 gets moved to Flexi Access Account and is only taxed when you make a withdrawal ?

My questions are -  

My pot is invested in Royal London Governed Portfolio 2,
Charges 0.4% and I also have Profitshare.
If I'm happy with the Governed Portfolio 2, Will the money which moves to Flexi Access after i take my Tax free sums, Still have the same charges and be included in Profitshare  ? 

I am in the same position as you with Royal London and moving into drawdown now. Can i ask why you have chosen GP2? I am in GP4. I will be doing the same as you, but taking 20k TFLS and 12k taxable. I have requested to only move 80k into drawdown and will leave 320k in GP4 Un-crystalised. The remaining crystallised 48k will be in the same investment portfolio

Thanks for the feedback Spivo46 , the reason I'm in GP2 is when I done a review of my pension and investments back in 2018, as I was approaching 60th Birthday, my pension was not  doing much as was automatic geared for annuity , and was put if safe funds. I done the risk profiler and was rated 4 ( slightly cautious). that's where financial adviser decided was best for me. Was working out pretty decent until Covid, war, and the rest. You have a bit more in your pot than me, although I do have Cash and SS ISA's. I have been self employed Joiner for over 34 years, Last 8/9 years i have been working as sole trader and gradually moving into part time / semi retirement. most recently 2/3 half days per week. The work I was doing has changed and is 2/3 half days per month, so I find myself having to start using my investments a bit early. I am 15 months away from state pension.  I probably have about 6/7k to use up in this financial year, nex financial year will include 3 months state pension. Will probably break into my Royal London GP2 into next tax year. 
I would like opinions as whether RL GP2 is decent enough for a drawdown pot . If so thinking of going it alone to avoid Financial Adviser charges of 0.75% ongoing to manage my investments or fixed sum for review and set up.

GP2 appears to be about 44% equity. depending on which data source you use.  The default allocation for a drawdown portfolio is often stated as 60% equity.  Broadly speaking the higher the equity %, the higher the return but also the higher the risk or volatility.

The danger of being over-cautious is that you make insufficient return to pay your desired drawdown amount for the the whole of your life, ie you run out of money or have to cut back on your expenditure before you die.  It would be helpful if you told us the drawdown you are wanting to take as a % of the initial pot size and whether you are expecting this to increase with inflation. 

Unless you give us some figures it is impossible to say whether your choice of GP2 is appropriate for your drawdown needs.

JSL_2

Spivo46 said:

JSL_2 said:

Spivo46 said:

JSL_2 said:

So begining to understand exactly how Flexi Access Drawdown Works

So for every £1 of Tax Free Money you take from pot , £3 gets moved to Flexi Access Account and is only taxed when you make a withdrawal ?

My questions are -  

My pot is invested in Royal London Governed Portfolio 2,
Charges 0.4% and I also have Profitshare.
If I'm happy with the Governed Portfolio 2, Will the money which moves to Flexi Access after i take my Tax free sums, Still have the same charges and be included in Profitshare  ? 

I am in the same position as you with Royal London and moving into drawdown now. Can i ask why you have chosen GP2? I am in GP4. I will be doing the same as you, but taking 20k TFLS and 12k taxable. I have requested to only move 80k into drawdown and will leave 320k in GP4 Un-crystalised. The remaining crystallised 48k will be in the same investment portfolio

Thanks for the feedback Spivo46 , the reason I'm in GP2 is when I done a review of my pension and investments back in 2018, as I was approaching 60th Birthday, my pension was not  doing much as was automatic geared for annuity , and was put if safe funds. I done the risk profiler and was rated 4 ( slightly cautious). that's where financial adviser decided was best for me. Was working out pretty decent until Covid, war, and the rest. You have a bit more in your pot than me, although I do have Cash and SS ISA's. I have been self employed Joiner for over 34 years, Last 8/9 years i have been working as sole trader and gradually moving into part time / semi retirement. most recently 2/3 half days per week. The work I was doing has changed and is 2/3 half days per month, so I find myself having to start using my investments a bit early. I am 15 months away from state pension.  I probably have about 6/7k to use up in this financial year, nex financial year will include 3 months state pension. Will probably break into my Royal London GP2 into next tax year. 
I would like opinions as whether RL GP2 is decent enough for a drawdown pot . If so thinking of going it alone to avoid Financial Adviser charges of 0.75% ongoing to manage my investments or fixed sum for review and set up.

I used an IFA back in 2017. They put me into Royal London GP1. I did not want the ongoing cost of the IFA so i went alone after the transfer. Last year i switched to GP4 as the returns were slightly better. It has an annualised growth of 4.4% (not bad considering world events). I have looked around but i think we are splitting hairs and i feel comfortable with RL, 0.4% management fees and the annual profit share is a bonus. I am coming up to 64 so drawing down a little early, but how much money do you need at 80 plus? Enjoy while you can - all the best

"How Much Money do you need at 80 Plus"
Spivo46, Your way of thinking exactly same as myself. I also feel comfortable with RL. I'm 65 at end of this year. I'm thinking on going with what I've got. Drawdown from pension and Isa's. Just need to decide on what's best with pension, FAD or UCTFLS.
Thanks. 

dunstonh

I used an IFA back in 2017. They put me into Royal London GP1. I did not want the ongoing cost of the IFA so i went alone after the transfer. Last year i switched to GP4 as the returns were slightly better.

GP1 is medium risk.   GP4 is medium to adventurous.

The three linked portfolios are 1-2-3 ,  4-5-6,  7-8-9.      With the first one being long term, second one being medium term and third one being short term.

You don't have to use the models that way if you are looking to fine tune the equity content.   However, do remember that certain assets in the models will reflect the timescale weighting.  So, you may increase the equity content with the long term model but also the weightings to assets with a short term or long term nature get adjusted as well.

So, think about when you need to be drawing the money.  You can use multiple GPs to reflect your draw rate.

Spivo46

dunstonh said:

I used an IFA back in 2017. They put me into Royal London GP1. I did not want the ongoing cost of the IFA so i went alone after the transfer. Last year i switched to GP4 as the returns were slightly better.

GP1 is medium risk.   GP4 is medium to adventurous.

The three linked portfolios are 1-2-3 ,  4-5-6,  7-8-9.      With the first one being long term, second one being medium term and third one being short term.

You don't have to use the models that way if you are looking to fine tune the equity content.   However, do remember that certain assets in the models will reflect the timescale weighting.  So, you may increase the equity content with the long term model but also the weightings to assets with a short term or long term nature get adjusted as well.

So, think about when you need to be drawing the money.  You can use multiple GPs to reflect your draw rate.

thats useful, long term is self explanatory but what is short term please? Do you switch to medium/short terms when you retire? GP 7 returns look quite healthy?

Spivo46

"GP1 is medium risk.   GP4 is medium to adventurous".

GP 4 is listed as Moderately Cautious / balanced

Linton

Spivo46 said:

dunstonh said:

I used an IFA back in 2017. They put me into Royal London GP1. I did not want the ongoing cost of the IFA so i went alone after the transfer. Last year i switched to GP4 as the returns were slightly better.

GP1 is medium risk.   GP4 is medium to adventurous.

The three linked portfolios are 1-2-3 ,  4-5-6,  7-8-9.      With the first one being long term, second one being medium term and third one being short term.

You don't have to use the models that way if you are looking to fine tune the equity content.   However, do remember that certain assets in the models will reflect the timescale weighting.  So, you may increase the equity content with the long term model but also the weightings to assets with a short term or long term nature get adjusted as well.

So, think about when you need to be drawing the money.  You can use multiple GPs to reflect your draw rate.

thats useful, long term is self explanatory but what is short term please? Do you switch to medium/short terms when you retire? GP 7 returns look quite healthy?

Short term is typically 5 years or less. Long term perhaps more than 12-15 years.  In between is medium term.  Long term is easy in that it is suitable for a high equity %.  Short term is easy because it basically means cash or close to cash.  Medium term is more tricky for investors.

Essentially the idea is that your investments are allocated in line with your needs over the different time periods.  When you retire you will still need a significant % long term to provide protection against inflation.

dunstonh

GP 4 is listed as Moderately Cautious / balanced

Context is needed within the scale and phrasing.  RL refer to it as cautious/balanced in one place but as balanced in their main factsheet.

GP4 has 75% equities and 6% commodities along with 12% property.    In many scales, that would put it above medium risk.    Broadly speaking, 60% equity is around medium risk and 80% equity around medium/high. 

Balanced is a phrase that was intended to be phased out as it was found funds using from 40% to 90% equity were calling themselves Balanced.     This led to the renaming of the old defensive, cautious and balanced sectors being renamed to reflect their equity content.   Some scales start with cash as the starting point.   Some scales start with gilts being the starting point.  Some scales end at mainstream global equity being the upper point. Some much higher.   Some have clear faults in that they put 100% emerging markets equity in the same risk score as 100% global equity.

So, you must always look at the context within your own risk analysis.