# What is sequence of returns risk in drawdown?

> Quick answer · Last updated 4 July 2026

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## In short

Poor investment returns early in retirement combined with withdrawals can permanently deplete a drawdown pot — even if average returns recover later. A cash buffer reduces the risk of selling equities in downturns.

Two retirees with the same average return can have very different outcomes depending on when losses occur.

Keeping one to three years of withdrawals in cash inside drawdown is a common mitigation.

See drawdown income guide.

## Related

- [Drawdown income guide](https://moneyguide.org.uk/pensions/pension-drawdown-income-guide/)
- [Flexi-access drawdown](https://moneyguide.org.uk/pensions/flexi-access-drawdown-basics/)

## Primary source

moneyhelper.org.uk/en/savings/investing

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Independent UK money guidance from [Money Guide](https://moneyguide.org.uk). Information only — not regulated financial advice.