Sequencing Risk
How and When you take money from Pension or Investment Pot can have a significant impact on how long your money lasts.
For example the diagram shows a comparison between having a good start and a poor start; both examples have an average return over 10 years of 6%, and withdraw £7,000 of Income annually from an initial fund of £100,000.
However by year 10 there is a £47,653 difference in values, highlighting the importance of Financial Advice as poor returns in the early years when you start taking income, can have a long term detrimental effect, even if you achieved the same average returns. In this example a Financial Adviser might advise you to use other Cash Savings in years that your Pension or Investment had poor returns so this reduces the impact on your money. Therefore making your money last longer for you and your family, which shows the importance of Financial Advice.
During volatile markets, a Financial Adviser will be able to help you consider the best ways to manage your Retirement Income and preserve your hard earned Retirement Wealth.
These figures are only examples and are not guaranteed – they are not minimum or maximum amounts. What you will get back depends on how your Investment grows and on the tax treatment of the investment. You could get back more or less than this.
Daniel Morgan
Dan Morgan Financial Associates
Discover how our tailored advice can help secure your finances today and deliver on your aspirations for tomorrow.
