This, they said, would be useful to a pensioner in terms of income provision as well as a sustainable rate of withdrawal on a fund without subjecting the fund to the possibility of sequencing risk - that is, the risk of losing too much, too soon, and not being able to recoup the performance.
The 36-page study, called Decumulation, Sequencing Risk and the Safe Withdrawal Rate: Why the 4 per cent Withdrawal Rule leaves Money on the Table, built upon earlier studies which aimed to work out the perfect withdrawal rate (PWR).
Take out too little and you might not be able to meet basic living expenses: take too much out and you could significantly, irreparably, damage the pension pot's ability to continue to support you through the rest of your life.
Ms Smith says: "This highlights the importance of taking advice from a qualified adviser around income levels and their ongoing suitability, not only to ensure these risks can be mitigated but also to keep the investment and drawdown strategy under review."
Management
For Mr Steedman, one of the biggest drawbacks is the fact drawdown requires "careful management and support" to deal with all the above issues, as well as the "liquidity, underlying investment management monitoring and tax planning".
He says for all of this, one should seek ongoing support from a "good financial adviser" - but all of this management carries a cost.
Education should go some way to helping people be better managers of their money both in accumulation and decumulation.
Claire Felgate, head of DC investments for BlackRock, states: "We believe it is important to continue to educate people that planning for the long term, and investing for retirement, is crucial."
This is as important to those starting out on their savings journey as well as for those entering into their pensionhood.
simoney.kyriakou@ft.com
