"The best performing pension could produce more than three times more pension income than the worst performing one. The really bad news is that your pension fund is more likely to be amongst the bad than the good" The Observer
One of the key features of income drawdown is the ability to vary income taken from the pension fund.
This variation might be dependent on income needs but may alternatively be prompted by tax planning strategies (for example, taking higher income from the pension fund in years of low taxable income elsewhere, or vice-versa). Other aspects of flexibility within the income drawdown contract are the ability to follow and re-adjust an investment strategy and (very importantly) the ability to change nomination for death benefits from time to time.
There are potential pitfalls to all of these factors, so how can an investor seek to minimise or avoid those pitfalls?