We've seen a lot of headlines this year about the impact of global and political events on investment markets. Its understandable if what you're hearing in the news is leaving your concerned about your pension savings. 

To help you feel more in control, you might find it useful to learn more about how investing in your pension works, and things to consider if you're reviewing your investment options.

Understanding investing

When you put money into your pension, we invest your money in a fund. A fund is a type of collective investment in which lots of people put their money, with the aim of helping their savings grow.

A fund manager decides on the objectives of the fund, and then chooses where your money goes to achieve this. This could mean investing in things like company shares, property, bonds, and cash.

The contributions that you and your employer make into your pension are paid into a fund which is chosen for you. This is called the default investment option and, unless you decide to make your own investment choices, this is where your contributions will stay.

Although a default investment option is considered a good starting point for most people, it doesn’t consider your personal circumstances. Even if you’ve already started choosing your own investments, it’s worth considering whether your pension savings are still invested in a way that is right for you.

 

Significant movement in investments

The Russia/Ukraine conflict has contributed to a significant movement in share prices and other investments which has meant, for many people, a reduction in the value of their pension pot. This can be worrying, especially for less experienced investors, but needs to be seen in the context of long-term returns.

You can be sure that our fund managers will continue to work with a team of economists, strategists and analysts and continue to manage our funds in line with their stated aims and objectives.

Manage Your Account

It is important to review regularly how your pension pot is invested. If your pension is invested in a lifestyle profile, make sure that its target retirement aims match your own. More information about your investments, and the funds and lifestyle profiles available to you, are available in Manage Your Account.

Lifestyle profiles and gilts

A lifestyle profile is designed for investors who wish to purchase an annuity when they reach their retirement date (i.e. a guaranteed level of income for life). This type of investment will typically move members out of equity (stocks and shares) based investments and into gilts as they near their retirement date.