Aviva Pension decreased by £10,000 in 12 months

dunstonh

bostonerimus said:

dunstonh said:

 Is this the general trend for pensions over the past 12 months or do I need to think about changing provider?

Pensions do not make or lose money.   The investments you select make and lose money.  The provider is just an administrator for your pension.  It doesnt have an impact on things either.

2022 has been a negative year.  Nothing unusual in that.  

And in additional, would I be better off putting the monthly savings into an alternative savings pot rather than a pension?

There was a bigger loss period in 2020. What did you do about it then?
There were similar loss periods in 2018, 2015/16/ What did you do about it then?
There are larger loss periods in 2008 and 2000-2002. What did you do about it then?

Investments go down as well as up.  Not every year can be a positive.  You have to average out the ups and downs.

Yes, it's a general trend brought on by economic conditions across the world, and to some degree by the poor handling of the UK economy by the Conservative governments of Cameron, May, Johnson and Truss.

And Labour.   
The fall in gilts has largely come about due to the sudden unwinding of the consequences of quantitive easing that was brought in because of the credit crunch.   Which occured under Labour.
The liquidity issues with defined benefit pensions were warned about after Gordon Brown carried out his pension raid.  There were predictions it would happen within 20 years.
Inflation has been a key driver to the problems this year.   Most of that is caused by the cost of energy.  The UK energy policy was put in place in the 2008 Energy Act by Labour.    You can blame the Conservative/Lib Dem coalition and then the conservative governments for following it but you still have to blame the instigators of it - Labour.

The Conservatives have been a mess but to put the issues at their door only would be incorrect.

Any party that has been in power for over a decade has had plenty of time to reverse the errors of previous administrations. Lack of personal, or organizational responsibility, is a worrying trend as it forms part of the foundations of a functioning society. Using this principle wrt the OP's question they need to look "under the bonnet" of their pension and take the personal responsibility to understand how their money is invested and how fits in with their overall personal investment strategy. Asking their question here might be the first step in that process.

Economies are like oil tankers.  It can take a decade or two for a government's actions to come to fruition.    The Government of the day will take the good news and pretend it was them.  And take the bad news and look to blame someone else.    The current issues have been brewing for over 20 years.  

bostonerimus

dunstonh said:

bostonerimus said:

dunstonh said:

 Is this the general trend for pensions over the past 12 months or do I need to think about changing provider?

Pensions do not make or lose money.   The investments you select make and lose money.  The provider is just an administrator for your pension.  It doesnt have an impact on things either.

2022 has been a negative year.  Nothing unusual in that.  

And in additional, would I be better off putting the monthly savings into an alternative savings pot rather than a pension?

There was a bigger loss period in 2020. What did you do about it then?
There were similar loss periods in 2018, 2015/16/ What did you do about it then?
There are larger loss periods in 2008 and 2000-2002. What did you do about it then?

Investments go down as well as up.  Not every year can be a positive.  You have to average out the ups and downs.

Yes, it's a general trend brought on by economic conditions across the world, and to some degree by the poor handling of the UK economy by the Conservative governments of Cameron, May, Johnson and Truss.

And Labour.   
The fall in gilts has largely come about due to the sudden unwinding of the consequences of quantitive easing that was brought in because of the credit crunch.   Which occured under Labour.
The liquidity issues with defined benefit pensions were warned about after Gordon Brown carried out his pension raid.  There were predictions it would happen within 20 years.
Inflation has been a key driver to the problems this year.   Most of that is caused by the cost of energy.  The UK energy policy was put in place in the 2008 Energy Act by Labour.    You can blame the Conservative/Lib Dem coalition and then the conservative governments for following it but you still have to blame the instigators of it - Labour.

The Conservatives have been a mess but to put the issues at their door only would be incorrect.

Any party that has been in power for over a decade has had plenty of time to reverse the errors of previous administrations. Lack of personal, or organizational responsibility, is a worrying trend as it forms part of the foundations of a functioning society. Using this principle wrt the OP's question they need to look "under the bonnet" of their pension and take the personal responsibility to understand how their money is invested and how fits in with their overall personal investment strategy. Asking their question here might be the first step in that process.

Economies are like oil tankers.  It can take a decade or two for a government's actions to come to fruition.    The Government of the day will take the good news and pretend it was them.  And take the bad news and look to blame someone else.    The current issues have been brewing for over 20 years.  

Sure, things like energy policy and large infrastructure projects are usually programs that will span several administrations and so they are often negotiated on a cross party basis. But if a party doesn't like a policy they should change it all the sooner to achieve what they want. Leaving poor policy in place is bad governance and blaming policies from a decade ago shows a lack of desire to change it and a lack of personal responsibility, IMO. Politicians will always do this as they need a quick excuse and blaming someone else is a classic. Such behaviour should be kept out of our own lives if we want to react sensibly to circumstances and if we value our own integrity..."to thine own self be true".

shilts

I’m by no means an expert and I have a limited understanding but do take an active interest. I think most people’s pensions are down for all of the reasons mentioned above . I’m in a similar situation to you but see it as an opportunity . I like yourself have paid regularly into my pension monthly and will continue to do so while I’m able to . The way I see it is that I’m buying at a cheaper rate and will continue to do so . This I hope will make my pension recovery stronger and perhaps a little quicker . As I have about 7 years or so to retirement I’m not overly concerned . I appreciate though that anyone thinking of retiring in the next year or two have it more difficult . As I said I’m no expert but hope this helps .

bostonerimus

shilts said:

I’m by no means an expert and I have a limited understanding but do take an active interest. I think most people’s pensions are down for all of the reasons mentioned above . I’m in a similar situation to you but see it as an opportunity . I like yourself have paid regularly into my pension monthly and will continue to do so while I’m able to . The way I see it is that I’m buying at a cheaper rate and will continue to do so . This I hope will make my pension recovery stronger and perhaps a little quicker . As I have about 7 years or so to retirement I’m not overly concerned . I appreciate though that anyone thinking of retiring in the next year or two have it more difficult . As I said I’m no expert but hope this helps .

Good points, but remember that in drawdown you could, hopefully, have another 25 or 30 years of investing in front of you. You need to know how your money is invested while you are working so that it grows to meet your retirement income needs and then you need to manage that pension pot to provide you income for the rest of your life. Previously that was simpler as all you would do was buy an annuity, but today's pension environment has a lot of options so whether you DIY or employ an advisor you should understand the basic mechanisms of your various pension options so you can make sensible choices.

michaels

tacpot12 said:

Yes, it's a general trend brought on by economic conditions across the world, and to some degree by the poor handling of the UK economy by the Conservative governments of Cameron, May, Johnson and Truss. You might wonder how decisions taken by David Cameron might have had an effect in the last 12 months, but I think that it is only in this time that business leaders and the markets have come to appreciate just how bad Brexit will be for the UK.  

My pension has lost about £60,000 over the same period, but has regained about £20,000 over the last couple of weeks. I expect that shares will be back on track in a couple of years - share values tend to represent the market sentiments about the future, so go down quickly when there is hint of trouble, and recover as the extent of the trouble is known and the end is in sight. I think the UK will be recovering slowly by 2025. 

At 52, you have time for the markets to recover, but I would recommend checking in your pension has any 'Lifestyling' features. If it does, you probably need to consider how you are going to draw your pension. If you are definitely going to buy an Annuity, Lifestyling may be appropriate (but still carries risk), but if you are going to drawdown income from your pension, get any Lifestyling turned off now!

What an odd post.  Most pensions will be invested globally so unless Brexit is responsible for falls in US shares it would seem much more that someone has a bee in their bonnet rather than any grasp of the facts.  Hard for some to believe but the FTSE is one of the best performing indexes over the last 12 months.

[Deleted User]

michaels said:

tacpot12 said:

Yes, it's a general trend brought on by economic conditions across the world, and to some degree by the poor handling of the UK economy by the Conservative governments of Cameron, May, Johnson and Truss. You might wonder how decisions taken by David Cameron might have had an effect in the last 12 months, but I think that it is only in this time that business leaders and the markets have come to appreciate just how bad Brexit will be for the UK.  

My pension has lost about £60,000 over the same period, but has regained about £20,000 over the last couple of weeks. I expect that shares will be back on track in a couple of years - share values tend to represent the market sentiments about the future, so go down quickly when there is hint of trouble, and recover as the extent of the trouble is known and the end is in sight. I think the UK will be recovering slowly by 2025. 

At 52, you have time for the markets to recover, but I would recommend checking in your pension has any 'Lifestyling' features. If it does, you probably need to consider how you are going to draw your pension. If you are definitely going to buy an Annuity, Lifestyling may be appropriate (but still carries risk), but if you are going to drawdown income from your pension, get any Lifestyling turned off now!

 Hard for some to believe but the FTSE is one of the best performing indexes over the last 12 months.

FTSE100: -2.49%ytd (GBP) 
TSX60: - 5.49%ytd (CAD) or +4.7% corrected for currency (GBP)
S&P500: -16.75% (USD) or close to zero in GBP. 

You get my drift.  We. can’t compare anything using just values unless we normalize to the same units.  One would have been better off investing in N American markets even though nominally FTSE did great if you measure in a currency which dropped like a stone. 

But your point that we can’t blame Cameron for 2022 bear market in the US seems hard to argue with.

LHW99

When markets drop I have tended to look at the number of shares / units in my pension fund, particularly when still regularly adding to it. The number of units tends to increase in that situation, so even if the total "value" is down, I can see that once the markets come back up, the extra units will be helping it to overtake the pre-fall total a bit more quickly.

artyboy

Deleted_User said:

My pension decreases by more than that on certain days.  Fairly regularly.  When it persists, I count losses in Hondas Civics rather than thousands.  Its a better benchmark as I can adequately compare to what happened in 2008 without having to use the devalued currency.  Things did recover then. 

I'm glad it's not just me! Although I count my (very theoretical) losses in terms of the cost of nice ski holidays, rather than cars. We all have our passions...

elouise01582

Is the maximum not £240 per month?

Audaxer

elouise01582 said:

Is the maximum not £240 per month?

Yes, I was about to say the same. If the OP has no earnings, then they can pay in a maximum of only £240 per month (£2,880 per year) into a pension. That amount gets £720 tax relief from the government, taking it up to a gross annual contribution of £3,600.