How often do you check the value of your pension? And is contributing to a pension simply gambling?

CharlieC2210

Is it wise to stop looking at the value of your pension on a regular basis (several times a year, or more)?

Occasionally I have to log into my pension for something. The value of the pension is right there on the first page I come to. If it’s gone down, say a thousand pounds since I last looked, I get a shock. If it’s gone up I get a buzz.

A while back I was logging in a few times a week for a while, to check my messages (I was sorting something out with the company). Each time I logged in the value had gone down, often by several hundred pounds. In the space of a few weeks it had gone down over a thousand pounds. I reminded myself that these things do go up and down and it’s all about the long run. But it was still scary.

If the best advice is not to check the value on a regular basis, when is it wise to check? Once a year? When they send your annual statement?

What if it went down, and down, and down?

In what way is contributing to a pension like going to the casino. Do we need to accept that we’re gambling? That we might lose?

If it went down, and down, and down, to nothing would there be any compensation scheme to help us out? Or would it be tough luck; we took a punt; and we lost? Or at what point would it be wise to cash in, if it was going down, and down and down?

 

sevenhills

I log into my SIPP every day, on my mobile. If I didn't have the app on my smartphone I would do it a lot less often.
I do accept that I do it too often, monthly should be enough.

Albermarle

CharlieC2210 said:

Is it wise to stop looking at the value of your pension on a regular basis (several times a year, or more)?If it stresses you to do so, then don't do it .

Occasionally I have to log into my pension for something. The value of the pension is right there on the first page I come to. If it’s gone down, say a thousand pounds since I last looked, I get a shock. If it’s gone up I get a buzz. Investments go up and down all the time, what matters is the long term performance ( > 10 years)

A while back I was logging in a few times a week for a while, to check my messages (I was sorting something out with the company). Each time I logged in the value had gone down, often by several hundred pounds. In the space of a few weeks it had gone down over a thousand pounds. I reminded myself that these things do go up and down and it’s all about the long run. But it was still scary. Why is it scary, it is entirely normal?

If the best advice is not to check the value on a regular basis, when is it wise to check? Once a year? When they send your annual statement?

What if it went down, and down, and down? With a normal pension fund, for this to happen would mean all large companies and all major governments in the world were bankrupt. The only likelihood of it going down to zero, is if was invested in something very specialised/exotic, which seems unlikely

In what way is contributing to a pension like going to the casino. Do we need to accept that we’re gambling? That we might lose? There is a possibility you might lose, but historical statistics show that to be very unlikely in the long run

If it went down, and down, and down, to nothing would there be any compensation scheme to help us out? Or would it be tough luck; we took a punt; and we lost? Or at what point would it be wise to cash in, if it was going down, and down and down? It would not be wise to cash in , as selling when investments are down is nearly always a bad move.

 

Suggest you look how your pension has performed over the last 10 years rather than 2 years.
Also you have presumably benefitted from tax relief and maybe employer contributions.

Kerreh

I log in once a month to check the contribution has gone into the pot (I check my savings land in their accounts so treat the pension the same). @ 40yrs old I pay little attention to the balance currently.

JohnWinder

You’d need to choose your own definition of gambling, but at the casino you’re sure to lose on average because that’s how their business runs. You lose money, they provide some fun and make some profit with that money. If you invest sensibly you are very likely to get positive returns over a realistic period. They seem different.

Look at it often enough to guard against malfeasance.

Linton

CharlieC2210 said:

Is it wise to stop looking at the value of your pension on a regular basis (several times a year, or more)?

Occasionally I have to log into my pension for something. The value of the pension is right there on the first page I come to. If it’s gone down, say a thousand pounds since I last looked, I get a shock. If it’s gone up I get a buzz.

A while back I was logging in a few times a week for a while, to check my messages (I was sorting something out with the company). Each time I logged in the value had gone down, often by several hundred pounds. In the space of a few weeks it had gone down over a thousand pounds. I reminded myself that these things do go up and down and it’s all about the long run. But it was still scary.

If the best advice is not to check the value on a regular basis, when is it wise to check? Once a year? When they send your annual statement?

What if it went down, and down, and down?

In what way is contributing to a pension like going to the casino. Do we need to accept that we’re gambling? That we might lose?

If it went down, and down, and down, to nothing would there be any compensation scheme to help us out? Or would it be tough luck; we took a punt; and we lost? Or at what point would it be wise to cash in, if it was going down, and down and down?

 

Choosing small numbers of shares in a small number of individual companies could be close to gambling.  However if you are invested widely, say in a global index fund, you will be holding shares in possibly thousands of companies across the world.

For such a fund to go down and down to zero would imply the world's economic system has collapsed in which case your investments would probably be near the bottom of your list of worries, well below your job and or even whether you can buy food for the next week.  A broadly invested fund is very unlikely to even remain constant over the long term.  Each underlying share you own represents ownership of part of a company.  As an owner you get a proportion of the profits either directly as dividends or by their re-investment in the expansion of the company.  For the majority of the companies you part-own not to make profits again would imply a global economic disaster.

If you are going to get worried, looking at your pension more than once a year is pretty pointless. Assuming yor investments are sensible selling in a panic wold be foolish, the idea of buying and selling is to sell when prices are high and buy when prices are low, not the other way round.   If a fund price does fall significantly temporarily it would mean that your on-going pension contributions would be buying more of the underlying companies.

dunstonh

Is it wise to stop looking at the value of your pension on a regular basis (several times a year, or more)?

Yes.   You can drive yourself crazy if you check it too frequently.  When its going up you wont care but during negative periods, you are putting yourself at risk of making bad decisions.

Prior to 2018, statements were issued annually with most (some types of pensions still are but platforms are quarterly).  With annual statements, you miss most of the volatility and see smoother and reduced level of volatility.

I had a conversation recently with someone who said that he had never seen his pension lose money in a year before.  So, I asked him about 2020.  He said it didnt lose money.  It did but he never saw it as it was in between statement dates.    I asked him about 2018 but he missed that one too as again, it was between statements.  As was 2015/16.     I thought I may get better luck with 2008 or 2000-2001 but no, he missed those too because he didnt even bother looking at the statements back then.     

And it was a good job he didnt look as his 2022 was small compared to the 2000-2002, 2008 and 2020 losses.

Each time I logged in the value had gone down, often by several hundred pounds. In the space of a few weeks it had gone down over a thousand pounds. I reminded myself that these things do go up and down and it’s all about the long run. But it was still scary.

a few thousand isnt that scary. Wait until it gets big enough (as you get closer to retirement) and the fund can move tens of thousands or even over hundred thousand.

What if it went down, and down, and down?

What is your definition of down and down and down?
Armageddon is the scenario you are suggesting but its likely that the pension would go down much in a Nuclear war.  a) if there is nuclear war then investments become meaningless.  b) if it doesn't happen, then all you would have done is sold out for no reason.

In what way is contributing to a pension like going to the casino. Do we need to accept that we’re gambling? That we might lose?

Its not at all comparable as you are not buying an asset when you gamble.   With investments, you are buying assets that have a value.    Like most assets, values change.  

Global economies go through cycles.   Growth, steady and decline.      The value of your investments will change up and down through that cycle.   So, when you hit a decline period, you dont worry it because you know its just a short term issue.

If it went down, and down, and down, to nothing would there be any compensation scheme to help us out? 

If a nuclear war comes along or an asteroid hits the planet, or a plague wipes everyone out, do you really think a) you would still be alive and b) you would be worrying about some compensation?

Or at what point would it be wise to cash in, if it was going down, and down and down?

What use do you think electronic currency would be of any use if you are one of the minority of the human race still alive?

L9XSS

I review it weekly, but then I’m trading ETFs quite frequently.

Saver73

I check my pensions once a year, I had been checking savings more often due to the rates changing and opening new accounts but now I've got less accounts, I plan to check once a year on the maturity date or at the same time as I check my pension.

I check my current account monthly.

I opened a Wealthify account recently and have only looked at it once when the funds were credited. I've got a diary reminder to check it next year and claim the cashback!

westv

sevenhills said:

I log into my SIPP every day, on my mobile. If I didn't have the app on my smartphone I would do it a lot less often.
I do accept that I do it too often, monthly should be enough.

Mine is all added to Trustnet and I check the value every day too.

CharlieC2210

Albermarle said:

CharlieC2210 said:

Is it wise to stop looking at the value of your pension on a regular basis (several times a year, or more)?If it stresses you to do so, then don't do it .

Occasionally I have to log into my pension for something. The value of the pension is right there on the first page I come to. If it’s gone down, say a thousand pounds since I last looked, I get a shock. If it’s gone up I get a buzz. Investments go up and down all the time, what matters is the long term performance ( > 10 years)

A while back I was logging in a few times a week for a while, to check my messages (I was sorting something out with the company). Each time I logged in the value had gone down, often by several hundred pounds. In the space of a few weeks it had gone down over a thousand pounds. I reminded myself that these things do go up and down and it’s all about the long run. But it was still scary. Why is it scary, it is entirely normal?

If the best advice is not to check the value on a regular basis, when is it wise to check? Once a year? When they send your annual statement?

What if it went down, and down, and down? With a normal pension fund, for this to happen would mean all large companies and all major governments in the world were bankrupt. The only likelihood of it going down to zero, is if was invested in something very specialised/exotic, which seems unlikely

In what way is contributing to a pension like going to the casino. Do we need to accept that we’re gambling? That we might lose? There is a possibility you might lose, but historical statistics show that to be very unlikely in the long run

If it went down, and down, and down, to nothing would there be any compensation scheme to help us out? Or would it be tough luck; we took a punt; and we lost? Or at what point would it be wise to cash in, if it was going down, and down and down? It would not be wise to cash in , as selling when investments are down is nearly always a bad move.

 

Suggest you look how your pension has performed over the last 10 years rather than 2 years.
Also you have presumably benefitted from tax relief and maybe employer contributions.

Thanks, Albermarle, I've decided to stop doing it, even to the point where if I have a message from them (Standard Life btw) I cover the part of the screen with the pension value with one hand until I've clicked on messages. 

> 10 years, yes, good advice.

I know it's normal but the rational part of the brain, etc, etc...

"...selling when investments are down is nearly always a bad move." Do you mean this kind of investment only (run of the mill pension)? I'd imagine that with stocks and shares it's often a good move to sell when your investment is down depending on why it's down. But my knowledge of these things, if you can call it knowledge, extends to the odd Hollywood movie.

Yes, it's done alright over the last 10 years, and I have benefitted from tax relief and employer contributions.