Drawdown plan

horace972897

https://forums.moneysavingexpert.com/discussion/comment/81892846#Comment_81892846

😀 Klingons on the starboard bow?

There's loads of info on the Internet about them - they resonated with me as they seemed to be a check and measure to make sure you don't drawdown too fast.

Albermarle

https://forums.moneysavingexpert.com/discussion/comment/81892846#Comment_81892846

There was a regular poster who was a great advocate of them, but he suddenly stopped posting . Maybe he was zapped by a Phaser.

More seriously Vanguard promote a simpler version of the GK strategy, which they call dynamic spending.

How to make your pension last – and your retirement enjoyable

DT2001

I think your strategy looks good. I started with a similar plan - topping up from our cash if the market fell. I have since tweaked my plan as my global ETF rose well this year, I now have roughly 20% in cash, 20% in income producing ITs and 60% global ETF. The ITs should produce about 5% (of the original purchase price) so take the pressure off the ETF.

Smudgeismydog

As I understand it, you will take £12,570 annually from your SIPP to utilise your personal allowance, whilst your wife will have a DB in payment. You will be moving money from your SIPP to fund both your ISAs via TFC withdrawals.

What does the total value of your estate look like, particularly your figure post 2027, once your SIPP is included for IHT purposes?

I don’t know the value of your SIPP, but is there merit in taking a higher income, pre State pension? Yes, this would incur tax at 20%, but depending on the value of your SIPP, and total estate, it might be more tax efficient if your SIPP is large, and you are within IHT territory.

Just a thought

Triumph13

If you'll only ever be a 20% taxpayer, then your plan looks reasonable as you are fully utilising your PA each year. Possible reasons to consider drawing rather more income at 20% tax, assuming you can shelter it in ISAs, include:

• Possibility of hitting HRT threshold if SIPP grows well
• Possibility of income tax rates increasing in the future
• Interaction with IHT threshholds

horace972897

https://forums.moneysavingexpert.com/discussion/comment/81894534#Comment_81894534

https://forums.moneysavingexpert.com/discussion/comment/81894840#Comment_81894840

Thanks both - i'm am leaning towards taking up to the limit before 40% tax, as you are correct, IHT could well be an issue. I also want to make sure my gifts out of income ARE gifts out of income and come don't back to bite my heirs. The money went in with 40% relief plus the growth and i'm not averse to paying some tax to "pay my way"

Total pot is getting very close to the old lifetime allowance so getting that down and into ISA's and gifting needs more thought.