# Flexi-access drawdown basics

> Pensions & retirement · Last updated 4 July 2026

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## Quick answer

Flexi-access drawdown lets you keep pension savings invested while taking taxable income as needed — unlike an annuity, income is not guaranteed and can run out.

## Who should skip this

Skip this page if you need a personal recommendation or a live quote. This is general UK information — confirm today's figures with the official source linked below.

Drawdown became the default option for many DC retirees after pension freedom rules in 2015. You crystallise part or all of a pot, take tax-free cash, and leave the rest invested. This guide covers risks and tax.

## Key facts

- You move pension funds into a drawdown pot and choose investments like a SIPP
- Income withdrawals are taxed as earnings — plan amounts to avoid unnecessary higher-rate tax
- Remaining funds can pass to beneficiaries on death, often tax-efficiently before age 75
- Flexible withdrawals trigger the money purchase annual allowance of £10,000

## Setting up drawdown

Most SIPPs and workplace pensions offer drawdown. You may take tax-free cash first, then leave the rest invested in funds you select.

Charges include platform fees, fund OCFs and sometimes drawdown administration — compare before moving. Higher drawdown fees compound over decades of retirement.

## Managing income

Many retirees take a fixed monthly amount like a salary. Others take ad hoc lump sums for holidays or home improvements.

Keep a cash buffer inside drawdown for one to three years of planned withdrawals to avoid selling investments in downturns. This sequence-of-returns protection is a common drawdown strategy.

## Investment risk

Unlike annuities, drawdown pots can fall in value. Sequence-of-returns risk hurts if markets drop early in retirement — diversification and sensible withdrawal rates matter.

Pension Wise offers free appointments to compare drawdown with guaranteed annuity income. You can book online or by phone before making irreversible pension decisions.

## Frequently asked questions

### Can I move from drawdown back to accumulation?

Generally no — once in drawdown you cannot undo crystallisation, though you can stop taking income.

### Is drawdown right for everyone?

People needing guaranteed income or worried about investment risk may prefer annuities or a mix of both.

### What happens on death?

Beneficiaries can often inherit drawdown funds or take lump sums — tax depends on your age at death and their tax position.

## Primary source

https://www.gov.uk/tax-on-your-private-pension/what-you-can-do-with-your-private-pension-pot

## Related

- [Drawdown income guide](https://moneyguide.org.uk/pensions/pension-drawdown-income-guide/)
- [Pension crystallisation](https://moneyguide.org.uk/pensions/pension-crystallisation-explained/)
- [Drawdown vs annuity](https://moneyguide.org.uk/pensions/drawdown-vs-annuity/)
- [Pension drawdown calculator](https://moneyguide.org.uk/tools/pension-drawdown-calculator/)
- [Pension Wise explained](https://moneyguide.org.uk/pensions/pension-wise-explained/)

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Independent UK money guidance from [Money Guide](https://moneyguide.org.uk). Information only — not regulated financial advice.