Company pension

AstinMatt

Hi

I was wondering if someone who give me some advice.

My company pension scheme moves my investments in to low risk ten years before retirement. Now they are now changing this to five years before retirement, unless I tell them otherwise.

When it comes to my pension I have a conservative approach to risk. Is it prudent to move to a less riskier investments at ten or five years?

Thanks

dunstonh

Is it prudent to move to a less riskier investments at ten or five years?

Depends on the state of the market at the time and how the switch into lower class assets takes place. Is it phased over 5 years or does it happen in one go?

It also depends on the risk of the investments prior to the lifestyling adjustments.

jamesd

It's imprudent to do it without regard to the state of the markets at the time it's done. They do it automatically so that those who don't care about the size of their pension get some protection. You can presumably choose to do it yourself based on the state of the markets during those years. If so, you'd choose to move gradually into lower risk during times of market highs and not during times of market lows.

It's intended for those who will buy an annuity on retirement. If you'll use income drawdown it's far less important because you don't have a fixed date on which you'll be taking the money out of the more volatile investments.

AstinMatt

Thanks for your responses.

It has two phases classed as:

• more than five years
• less than five years

Both of these funds are consider to have a low level of risk.

jamesd

If both have a low level of risk then both are probably too low a level of risk to be very suitable for long term pension investing. What are the options?