Pension drawdown investors have been given a boost after the government confirmed an increase in the amount of income they can take from their funds.
Investors in drawdown plans have been hit by a sharp reduction over the past two years in the maximum income they can take.
The maximum annual income from drawdown was cut in 2011 from 120 per cent of the value of the equivalent annuity to 100 per cent, with the aim of preventing retirees from using up their pots too quickly
However, plunging gilt yields, which have driven annuity rates down, have exacerbated the impact, with some investors seeing income more than halved.
The government announced in the Autumn Statement that it would restore the 120 per cent maximum. Now it has confirmed that the change will take effect for all drawdown years starting on or after 26 March.