Company Pension fund value

Val_s_5

I have been in a company pension scheme for 32 years, and have another 10 years to go. The scheme has changed a number of times. (DC with GMP, final salary part, back to DC).
The projected value has dropped from £14k to just below £10k in recent years.
I know interest rates have been low, and people are living longer, but to get less than 1/3 in a pension after so long doesn't feel right.
Does this return feel right to others?

dunstonh

The projected value has dropped from £14k to just below £10k in recent years.

That is most likely due to changes in the assumptions used (such as moving from monetary growth basis to SMPI basis amongst other things).

I know interest rates have been low, and people are living longer, but to get less than 1/3 in a pension after so long doesn't feel right.

Interest rates have little to do with investments unless you are in cash or fixed interest securities.

Does this return feel right to others?

There is no in formation in your post for us to know the actual returns in any context. However, I suspect your immediate issue is a change in the method of projection to include inflation and lower overall example rates.

atush

And with ten years to go, you can take matters into your own hands and pay more in?

Val_s_5

With the way it has grown so far, I am reluctant to put more money in. I feel let down, may be wrongly, but by paying into a pension for so long, I would have expected a better % of my salary - I know its not a final salary scheme, but even so, especially as previous predictions have been better.
I now I am not an expert, but there seems to be no accountability of fund managers. The figures change significantly but there is nothing that can be done!

greenglide

Is a projection of the whole pension (DC + DB + DC) or is it just the DC bit / bits?

To get £10k with widow(er) benefit and inflation linked (you havent given what the "value" actually represents) would cost over £200,000 with an annuity.

How much are you and you employer paying in - this matters as well.

dunstonh

With the way it has grown so far, I am reluctant to put more money in.

it is difficult to know if that is a fair assessment as you have only mentioned example projections using example assumptions which change periodically (irrespective of performance).

especially as previous predictions have been better.

they are not and never have been predictions. They are projections using assumptions. Most of these have moved from future terms to real terms in recent years. Some use the regulatory standards for the rates. Others use stochastic modelling (rates based on the underlying assets of the investments - so low risk investments will show a lower assumed return. Cash based could show a negative return).

there seems to be no accountability of fund managers.

Plenty of accountability. However, you have not once mentioned returns. You have only mentioned hypothetical figures. Not real ones. You are linking two totally different things.

The figures change significantly but there is nothing that can be done!

The figure changes wont be down to returns (at least not significantly).

coyrls

Has the fund value gone down, as you say in your heading or have the projections for an annuity gone down as you suggest in the body of your post? If it's the latter then it's likely that it is the assumptions used for the projection that have changed, as dunstonh has suggested.

There is no requirement to take an annuity at retirement and even if you do take an annuity it is likely that the assumptions that have been made won't actually match your circumstances at retirement anyway. It's probably more useful to look at the absolute value of your fund and growth over time. If you want a higher total value at retirement you will need better fund performance and/or higher contributions.

sandsy

The biggest factor in what comes out of a pension is what was put in. You still have time to improve your lot!

But do think logically about the length of time people live in retirement and the level of investment returns, and what that might mean in terms of the size of fund that is required to sustain a specific level of income.