You may wish to consider converting your pension into an annuity if you are approaching retirement age. Your insurance company will offer to buy your pension plan from you and in exchange they will provide you with an income for life. The advantage of an annuity is that you are effectively buying a protected income stream which is guaranteed for life.
There is an inflationary risk to the buying power of your annuity income over time but you are not subject to the ups and downs of the stockmarket and you know exactly where you stand. When you buy your annuity you can opt for capital protection so in the event of your dealth within the guarantee period a sum of money would be paid back to your estate. This provides peace of mind that in the event of your untimely death the insurance company will not benefit completely. Of course there is a cost to protection and this will be reflected in the annuity income at outset which will be lower.
If you need an income from your pension fund and you don't want to commit to an annuity purchase then another option is pension drawdown. Pension drawdown allows you to keep control of your pension fund but the income you recieve is not protected and you are vulnerable to potential stockmarket fluctuations.
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