Ad-hoc Pension Withdrawals and Cash Flows

PSA456

Hi all,
Wanted to get some opinions and help on Cash Flow modelling when an existing client is withdrawing an ad-hoc lump sum.
Do you do cash flows for all withdrawals? If it is just an ad-hoc withdrawal, do you still do a cash flow to show this? If so, how do you make this relevant?
Historically we have just done it for regular withdrawals.
Thanks

benjaminfabi

I find it varies between my advisers.

My best practice is:

If it's a one-off that clearly isn't likely to create a meaningful difference to a lifetime forecast, then I wouldn't bother. However, if it's a larger amount that will potentially create some harm, or if it's the second or more 'ad-hoc' withdrawal that is actually becoming a pattern, then I'll model it. For the latter, I tend to assume that some level of ad-hoc withdrawal will in fact be regular for a given period to show how that isn't sustainable.