Soldato
Depends mostly on if your scheme/provider allows partial transfers out. There are other limitations if you have protected rights etc.
Obviously only applies to DC pensions also.
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Pension fund performance - do you monitor yours, how is it doing, do you actively change it?
- Thread starter danlightbulb
- Start date
Obviously only applies to DC pensions also.
Soldato
No, a lot of public sector pensions are defined benefit, you don't have a pension pot really, you just get a set amount per year when you retire. I work in education and currently my pension amount isn't much less than my full time wage at the moment, you'd then have the state pension on top.
Soldato
Which is why, when people try and compare Public Sector jobs with their Private sector equivalents, they fail to include the healthy pension arrangements that the Public Sector may give and base it on monthly income.
Associate
Speaking of pension fund performance, if anyone reading this has anything invested in a with-profits fund, unless you are near maturity, seriously think about moving it elsewhere, even if the exit fees/market value adjustments look horrific. I looked at mine 3 years ago when I was 55, but should have looked at it 5 years before that
I would have done way better taking a hit (combined fees would have been >30%) and having 8 years growth, but by the time I did look at them, it was better to sit tight. Luckily for me these pots are a relatively small part of my provision
If you want a laugh at how poor the performance has been, one of my pots will be ~£3,600 at 60. The last contribution was in 1994, and total invested was around £2,400
I would have done way better taking a hit (combined fees would have been >30%) and having 8 years growth, but by the time I did look at them, it was better to sit tight. Luckily for me these pots are a relatively small part of my provision
If you want a laugh at how poor the performance has been, one of my pots will be ~£3,600 at 60. The last contribution was in 1994, and total invested was around £2,400
Soldato
I need to have a better read on this thread tomorrow but got me thinking about my pension as well, I have 3 of them all with Standard Life, I signed up and I can see all 3 in the same place, which makes combining them not necessarily a priority.
50% of my funds are in this fund:
Standard Life Multi Asset Mgd (20-60% Shares) Pn
The other 50% are in this fund:
SL Sustainable Multi Asset (PP) Pension Fund
The top one has done shockingly badly the last few years, especially compared to potential other funds I could have been in. The other one less badly, but not great. I sorted the list of funds by 5 year performance and the first one was #164 / 324, the second one was #104 / 324.
My priority until recently was to arrange my own savings and overpay my mortgage to get the equity down on the house a bit, whilst that still exists, it's coming down to a point where I think I could pivot some funds in the near future (few years away) towards savings/pension instead of the mortgage.
The pension performance in general for mine is pretty poor. I calculated that if I got paid again each month and then put all of that into savings, it would exceed the value of my entire pension after a year! Total profit across the entire pension pot over 17 years since it started is around 14%, whilst some of that is ramp up of incoming funds, and the fact that more money is being added now compared to 5 years ago (the mandatory 4% contribution thing) I still feel that this pension investment as it stands appears to be losing value, the only reason it's still worth doing is because half the money going in isn't mine.
Depressing figures aside, I'd like to take some steps to correct this error starting sooner rather than later. I need to look into which funds are good.
50% of my funds are in this fund:
Standard Life Multi Asset Mgd (20-60% Shares) Pn
The other 50% are in this fund:
SL Sustainable Multi Asset (PP) Pension Fund
The top one has done shockingly badly the last few years, especially compared to potential other funds I could have been in. The other one less badly, but not great. I sorted the list of funds by 5 year performance and the first one was #164 / 324, the second one was #104 / 324.
My priority until recently was to arrange my own savings and overpay my mortgage to get the equity down on the house a bit, whilst that still exists, it's coming down to a point where I think I could pivot some funds in the near future (few years away) towards savings/pension instead of the mortgage.
The pension performance in general for mine is pretty poor. I calculated that if I got paid again each month and then put all of that into savings, it would exceed the value of my entire pension after a year! Total profit across the entire pension pot over 17 years since it started is around 14%, whilst some of that is ramp up of incoming funds, and the fact that more money is being added now compared to 5 years ago (the mandatory 4% contribution thing) I still feel that this pension investment as it stands appears to be losing value, the only reason it's still worth doing is because half the money going in isn't mine.
Depressing figures aside, I'd like to take some steps to correct this error starting sooner rather than later. I need to look into which funds are good.
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Man of Honour
The only problem I see with "which funds are good" is that it's a purely historical view. While funds with more risk tend to provide more reward over time, this is pretty much the only thing even close to a rule in investing, as far as my amateur mind is concerned. It stands therefore that - when risk/reward is taken out of the equation, things that have done well will not necessarily continue to do so, although I appreciate it's the only hard data one can gather.
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Soldato
True but I can mix and match a little, and it seems that my current ones are not doing well, probably too UK centric where growth is slow
I just watched that along with a few of his other videos. Essentially he is saying do a global equities index with low fees.
Which is almost what I have now but the mix is probably a bit off, plus I have some bonds still. I think I will pivot to more equities and see what passive global trackers i can choose from in my scheme.
He quotes 10% p a though as a global average. Not many of the funds I've been looking at have done that well.
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Associate
My final salary pension ended in 2020 sadly.
I have one year (Jan 2020 to Jan 2021) contributing into a DC pension whilst working under GE. That one is invested in GE pension Saver Growth Fund and is currently 42% up.
Once takeover by Aernnova was completed where I work my DC pension was being put into L&G PMC 2040 - 2045 Target Date Fund 3. Investment started in Jan 2021. Not sure what that fund was invested in but by August last year it was running at -3%. It had been running -1% to -3% consistently for two years. I'm not really into investing but decided to roll the dice. I chose a 6 out of 7 risk value fund, I've 20 years left until retirement so figured take the risk now before changing back to a safer fund. I chose L&G HSBC Islamic Global Equity Index Fund 3, which tracks the Dow Jones Islamic Market Titans 100 TR Index. Swapped to that in September and I am now 6.4% up. I am quite twitchy due to the current instability in the middle East but to date it doesn't appear to be having much of an effect. Whilst I know past performance isn't an indicator of future performance this fund's past performance is partly why I chose it. I like the fact it's tracker and which companies are invested in.
To me it's all a gamble, whatever you choose. The downside is I'm not known for being that good at gambling! When do I swap again?..... There are so many funds to choose from through L&G it's hard to know which. I thought an HSBC one 'should' be OK.
I have one year (Jan 2020 to Jan 2021) contributing into a DC pension whilst working under GE. That one is invested in GE pension Saver Growth Fund and is currently 42% up.
Once takeover by Aernnova was completed where I work my DC pension was being put into L&G PMC 2040 - 2045 Target Date Fund 3. Investment started in Jan 2021. Not sure what that fund was invested in but by August last year it was running at -3%. It had been running -1% to -3% consistently for two years. I'm not really into investing but decided to roll the dice. I chose a 6 out of 7 risk value fund, I've 20 years left until retirement so figured take the risk now before changing back to a safer fund. I chose L&G HSBC Islamic Global Equity Index Fund 3, which tracks the Dow Jones Islamic Market Titans 100 TR Index. Swapped to that in September and I am now 6.4% up. I am quite twitchy due to the current instability in the middle East but to date it doesn't appear to be having much of an effect. Whilst I know past performance isn't an indicator of future performance this fund's past performance is partly why I chose it. I like the fact it's tracker and which companies are invested in.
To me it's all a gamble, whatever you choose. The downside is I'm not known for being that good at gambling! When do I swap again?..... There are so many funds to choose from through L&G it's hard to know which. I thought an HSBC one 'should' be OK.
Associate
Partly why I chose the fund I did. 5 year growth is 114%, 3 year growth is 37% and 1 year growth is around 27%.
Can but hope it continues this trend but who knows.
This Auto-Enrolment Pension Provider Cheat Sheet by Financial Interest might be handy for some.
Ring your current provider and find out the stipulations as they don't always put on their website. I had to ring mine and my partners and they gave different stipulations such as £ that needed to be left behind or % of the pot that needs to remain with them and you do the switch via the new provider after that. Vanguard are moving an old one for me at the moment before shift any more.
Ive continued analysing my available funds.
Here are the top 10 funds in my scheme over the past 5 years:
Note that only the top 7 funds have achieved over 10% p.a average returns. Are claims of consistent above 10% returns therefore a bit overstated? Especially in a balanced portfolio - which none of the top 10 funds by themselves are.
Edit to add - when I looked at this in October 2020, 23 funds had achieved more than 10% growth over 5 years as an average. So performance this time is down compared to back then. Does this suggest equities are starting to struggle?
30% of my portfolio is in fund 9 on this list, which did well so that's good. But the other 70% is way down the list in a fund in 41st place, this is because that fund is mixed assets and also contains bonds/gilts as well as equities with a higher proportion of UK equities.
Question is though whether bonds/gilts will start to come good again, theory is they should if interest rates start to fall.
A video I watched last night said that all of the global funds are deriving their growth mainly from US equities, and even more than that, the US market is deriving most of its growth from just 7 big technology companies.
The top fund on that list is badged as an islamic fund (sharia compliant) but on inspection it still contains the same big 7 US companies as other equities funds do. So not sure why its done better and whether that will continue.
I did a risk ranking on myself and watched a few videos on it. Out of four categories 'cautious' 'balanced' 'growth' and 'adventurous' I landed between balanced and growth. The video then said to go up a category if you're investing for 11+ years like I still am in my pension scheme. So that would put me in the growth category.
So on this basis my investment choices might need to be more biased towards the higher risk categories than they currently are.
Here are the top 10 funds in my scheme over the past 5 years:
Note that only the top 7 funds have achieved over 10% p.a average returns. Are claims of consistent above 10% returns therefore a bit overstated? Especially in a balanced portfolio - which none of the top 10 funds by themselves are.
Edit to add - when I looked at this in October 2020, 23 funds had achieved more than 10% growth over 5 years as an average. So performance this time is down compared to back then. Does this suggest equities are starting to struggle?
30% of my portfolio is in fund 9 on this list, which did well so that's good. But the other 70% is way down the list in a fund in 41st place, this is because that fund is mixed assets and also contains bonds/gilts as well as equities with a higher proportion of UK equities.
Question is though whether bonds/gilts will start to come good again, theory is they should if interest rates start to fall.
A video I watched last night said that all of the global funds are deriving their growth mainly from US equities, and even more than that, the US market is deriving most of its growth from just 7 big technology companies.
The top fund on that list is badged as an islamic fund (sharia compliant) but on inspection it still contains the same big 7 US companies as other equities funds do. So not sure why its done better and whether that will continue.
I did a risk ranking on myself and watched a few videos on it. Out of four categories 'cautious' 'balanced' 'growth' and 'adventurous' I landed between balanced and growth. The video then said to go up a category if you're investing for 11+ years like I still am in my pension scheme. So that would put me in the growth category.
So on this basis my investment choices might need to be more biased towards the higher risk categories than they currently are.
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@danlightbulb just so you know it might be worthwhile ringing them to see what the stipulations are on moving your pension to a private SIPP to Vanguard and Co so you have all your options covered.
I don't think I need to - I have options for various equities and bond funds in my current scheme. The bigger factor is deciding on the strategy.
My options are not great hence shifting as were worded as Balanced, Growth and Aggressive and fees are high for Aggressive via https://www.tpinvestor.com/portfolios
Should have transferred my final salary pension out during Covid, transfer value down well into 6 figures since then and transfer not worthwhile
Couple of defined contribution pensions have made about 2% total over last 4 years
Currently paying in about 2k a month to make up for crap performance
Couple of defined contribution pensions have made about 2% total over last 4 years
Currently paying in about 2k a month to make up for crap performance
Soldato
I'm going to look at seeing what I can move over to my own Vanguard SIPP, I feel like my current provider Standard Life is ripping me off on fees, and the funds I'm in are under-performing as well, things can go up and down, but most of the profit it quotes is lost to inflation. In 17 years my position is up 17% from the investment sum, sure some of that money comes in over time, but it's not exactly zoomed along and inflation is going to be counting against it.
Problem 1, I have 3 different pensions with Standard Life, not only are they varying sums, but they are also different types of pensions, so I need to work out what can or can't be moved.
Problem 1, I have 3 different pensions with Standard Life, not only are they varying sums, but they are also different types of pensions, so I need to work out what can or can't be moved.
I've had a look at my old council one and my SIPP, increasing the amount I put into the SIPP - still feel miles behind where I should be.
I assume not touching the final salary one is the best move, and hope I catch up on the SIPP side of things ?
I assume not touching the final salary one is the best move, and hope I catch up on the SIPP side of things ?