For account-based pensions including transition to retirement pensions, there’s a temporary 50 percent reduction in the minimum drawdown requirements for the 2019-20 and 2020-21 financial years, as shown in the table below. This measure is designed to assist retirees by reducing their need to sell investments to meet minimum drawdown requirements when market prices may be under pressure.

 

Age at start of pension and each 1 July
Default minimum percentage of account balance (%)
Reduced minimum percentage of account balance (%)*
Under 65 4 2
65-74 5 2.5
75-79 6 3
80-84 7 3.5
85-89 9 4.5
90-94 11 5.5
95 or more 14 7

*The reduced minimums are available for the 2019/2020 and 2020/2021 financial years. The minimum may be subject to change from time to time.

FAQs for Plum Members

  • If you joined Plum before 4 April 2020 and elected to receive the default minimum pension payment, this amount will continue to be paid to you for the remainder of the 2019/2020 financial year, unless you change your pension payments.

    If you joined Plum on or after 4 April 2020 and chose to receive the minimum amount for pension payments, then we applied the reduced minimum automatically.

    You may have already met the minimum pension withdrawal amount for this financial year, so if you’d like to change or suspend your pension payments, you can do this by calling us.

  • Yes. However, the minimums are determined differently to those in the table above for account based pensions. We therefore recommend that you call us or your adviser for more information.

  • If we determine that you’re currently on the minimum drawdown rate, from 1 July 2020 we’ll apply the reduced drawdown rate to your pension payments. This means you’ll receive a lower pension payment from 1 July 2020.

    If you have further questions, or you’d like to change your pension payment amount, you can contact us at any time.

    We’ll send you a letter in June/July 2020 to give an overview of your pension payments for the 2020/2021 financial year.

  • Nothing. Unless you decide to change your pension payments, you’ll continue to receive the amount you’ve chosen.