How to never run out of money in retirement

H

ow to make your pension pot last the distance is one of the biggest headaches facing anyone about to retire.

This is particularly true for those who decide to use drawdown, a strategy where savers can withdraw cash from their pot while leaving the rest invested.

The main appeal of this option is that it gives savers flexibility and control over their money. But with that comes the mammoth task of working out how much you need to cover the lifestyle you want while making sure it is sustainable for the rest of your life.

Experts often recommend the 4 per cent rule. This simply means withdrawing 4 per cent of the value of your pension each year — so if you had a £300,000 pot, you would take £12,000 — and leaving the rest invested to continue growing.