Pensionbee decimates my pension pot.

ewaste

LV_426 said:

Can I ask what happens to those in retirement, if the market dips like this? Do you just accept the hit and erosion of your fund value, or are people invested in more stable, but lower growth funds, post-retirement? 

That's ultimately upto the individual, that's why there are so many opinions and discussions on Safe Withdrawal Rates. There are various withdrawal strategies involving differing withdrawal rates and asset allocation. 

If you want secure income beyond that offered by the state pension then you buy an annuity. 

Mick70

These are unusual times (Russia ) and almost everybody pension funds will be down (mines down 8% , wife is 10%) , hold your nerve and hopefully they claw back , May take 4 months or May take 4 years , nobody knows 

others on here are more knowledgeable than me but I assume once you retire you move your funds into less volatile holdings so that not as much risk ?

NedS

LV_426 said:

Can I ask what happens to those in retirement, if the market dips like this? Do you just accept the hit and erosion of your fund value, or are people invested in more stable, but lower growth funds, post-retirement? 

For most people it's not really an issue. It used to be an issue where you had to use your fund to buy an annuity on the date of retirement, but since most people keep their pension funds invested for another 30 years and enter drawdown, it largely becomes irrelevant - just normal market volatility or short term noise.

I suppose if you wanted to cash in your pension and purchase a Lamborghini it may be an issue, and you may have to consider a more affordable super-car marque instead.

dunstonh

LV_426 said:

Can I ask what happens to those in retirement, if the market dips like this? Do you just accept the hit and erosion of your fund value, or are people invested in more stable, but lower growth funds, post-retirement? 

There is no "if".   It is "when".    These dips and far worse dips are always coming.  You typically see at least one large drop every 5 years.  And it could be that you see 2-3 years of negative years in a row and then have 7 positives.

You know they are coming and because you know they are coming, you don't spend all the gains you get in positive years.  You average out the ups and downs.     Many people maintain a cash float in retirement to see them through negative years and replenish the cash float in positive years (and with dividends/distributions).

Workerdrone

NedS said:

LV_426 said:

Can I ask what happens to those in retirement, if the market dips like this? Do you just accept the hit and erosion of your fund value, or are people invested in more stable, but lower growth funds, post-retirement? 

For most people it's not really an issue. It used to be an issue where you had to use your fund to buy an annuity on the date of retirement, but since most people keep their pension funds invested for another 30 years and enter drawdown, it largely becomes irrelevant - just normal market volatility or short term noise.

I suppose if you wanted to cash in your pension and purchase a Lamborghini it may be an issue, and you may have to consider a more affordable super-car marque instead.

Well that's sort of my plan. I'd like to buy a low mileage 2020 supercar in around 14 years. I took a look at the depreciation curve on some of their older models then added inflation back in over the term to come up with a rough cost in 2036 (Although I will now have to adjust that inflation figure). This gave me £118k to play with for the future car purchase price. Of course if things go better or worse I can always look to adjust the car I fancy up or down. The hardtop models being considerably cheaper than the Spyder versions. Its important to have a goal, but its just as important to enjoy the journey :-)

robatwork

The timing of your retirement is very unfortunate as you are not alone in having to postpone your plans due to the sudden drop in investments worldwide.

I hope if your pensionbee fund goes up 25% in 2023 you'll be on here extolling them.

Sadly I am not sure you're robust enough either for online forums, or investing in fund/bonds. 

Rtayl306

I'm not, but poor & I mean poor people like me who's bodies are knackered through working on the roads in all weathers, and who would like to retire to try & get some sort of retirement before I die do not like to see there money drop like it has. Why is it that my work pension is still making gains, all be moderate one's  & pensionbee looses me so much.  And for the others who mock me on here I was with Tilney, Best Invest another shower of sh**t before I joined pensionbee.

scobie

What this thread - and so many more like it - horribly illustrates is the incredible lack of financial knowledge the average person has.  

Imagine working for a pensions company had getting these sorts of calls all day every day and having to be polite in response.  I couldn’t do it. 

Johnnyy_Boy

I remember running into an issue like this back when lockdown started. My pot lost about 30k in a week or so and had no idea what to do.

Luckily I read some advice on here and also from a pension expert on Martin’s show. It was stop looking and sit tight. I managed to do that and about 6 weeks later it was all back. 

anonmoose

scobie said:

What this thread - and so many more like it - horribly illustrates is the incredible lack of financial knowledge the average person has.  

Imagine working for a pensions company had getting these sorts of calls all day every day and having to be polite in response.  I couldn’t do it. 

It is scary. No offence to OP but my teenage kids know more about volatility of their investments. It is shocking people are allowed to put life savings into something they don't understand even the basics of.

The sooner proper financial education is taught in schools the better. 

To OP, If there is any way you can leave the pension as is without withdrawing it, it will recover with time. You said you also had a works pension that hasn't done as badly. Maybe you could draw from that one first.

It is an unfortunate time to retire. Is there any way you could do a bit of part time work just for a year or so? That's what I plan to do if I hit retirement at this stage in the cycle.