Investment pathways must carry a sustainable income level warning to avoid savers complaining if they exhaust their pot prematurely, pensions experts have stated.

Bruce Moss, founder of fintech group eValue, said drawdown providers must go further than the Financial Conduct Authority’s “limited requirements” on investment pathways, and should put processes in place to stop savers unwittingly withdrawing an unsustainable level of income from their retirement pots.

He said failure to do this could see providers hit with complaints or even legal action.

Mr Moss said this was particularly an issue with investment pathway option three — taking an income within the next five years.

He said: “The problem mainly lies with option three at the moment. Without any information about the level of sustainable income that the pathway might be expected to support, not to mention how it might vary with investment outcomes, it leaves everyone exposed and people could complain against their provider.

“What is needed is not just to set this expectation at the outset, but also to provide regular updates — ideally annually or at times of severe market dislocation.”

However, Ivor Harper, director at advice company Park Financial, said it was down to the investor to decide their own withdrawal levels and providers cannot stop people behaving in a way that is “irrational and against their own best interests”.

He said: “The best a provider can do is to ensure that annually, or with every change to the payment amount if sooner, it issues clear and unambiguous warnings about withdrawal rates that exceed prescribed levels — possibly with a strong recommendation to seek advice.

“It needs to be short, punchy and simple if it is to have any impact at all.

“Other than warn people of their potential folly, as the rules now stand, I fail to see what else providers can really do.”