Capita workplace pension - huge loss

Albermarle

loveprada said:

Marcon said:

loveprada said:

El_Torro said:

There seem to be various issues here.

Firstly what they invest in is decided by you, not Capita. If they have done lifestyling (i.e. selling equities and buying bonds as you get closer to your retirement age) then it's because that is the fund you chose. If you told them to switch it somewhere else and they didn't do it that's an issue. How did you tell them? Do you have an online account where you can view your investments? Or you told them on the phone? 

If the only option with Capita is to buy an annuity and not drawdown while staying invested then you can always switch provider. Ideally to one that lets you do what you want to do. 

As for the value of the investment: Stocks and shares investments have struggled in the last 18 months, especially those with high percentages of bonds and gilts. I don't know if a fund with 100% bonds would have lost 50% in value, on the face of it that sounds too much of a drop to me. 

As for your question about getting your money back: I don't see that happening, no matter how much you complain. Capita don't control the stock market, neither do they control what you choose to invest in. 

I recall a few years ago I received some paperwork asking me what I want to do and how I want to receive the pension. I called them and discussed this and told them I wanted to remain invested.  I've been very busy with other issues in my family dealing with cancer and my mother's dementia. I admit I didn't grasp the reins to keep logging on to see what was going on. In the meantime the value of the pension pot has halved since January 22. I've been emailing them and they seem to have an attitude that either things are done their way or not at all. They're not even blaming me for not managing my pension. They've made it clear their intention was to have palmed me off at age 60 and I've been overstaying my welcome! I'm pretty sure I can move the money to another provider but I dont have a clue what to do with it. 

With regard to your last sentence, no they don't control the stock market but they have made bad decisions with my money. Probably moved it after making a loss, then moved it elsewhere and made more losses.  How would you explain the number of units issue?

They haven't made any decisions with your money. It's invested in the funds you have chosen. Capita are your scheme administrators, not your financial advisers.

Is this a trust based occupational scheme (if so it'll have trustees), as opposed to some sort of group personal pension?

Thanks, yes I think it is trust based. I would have thought someone makes the decisions to switch, don't they have actuaries and connections in the city who they deal with? The transactions took place, somebody did it and made a bad call and obviously it will affect a lot of people, not just me.

If you want someone to make financial decisions for you, move investments around etc, you need to pay a financial advisor/investment manager. Capita are just an administrator ( albeit a not very good one) and will only change investments on your instructions, or as part of fixed  lifestyle plan.

xylophone

Do you have a guide to this scheme?

Incidentally, have you obtained a stste pension forecast?

https://www.gov.uk/check-state-pension

loveprada

QrizB said:

loveprada said:

In the meantime the value of the pension pot has halved since January 22.

This seems quite odd.

What fund(s) is your pension invested in? Have there been any changes over that period?

What was the value in January 2022, and what is the value today?

loveprada said:

I would have thought someone makes the decisions to switch, don't they have actuaries and connections in the city who they deal with? The transactions took place, somebody did it and made a bad call and obviously it will affect a lot of people, not just me.

Capita are not fund managers. If Capita moved your money, it will have been on your instructions - either explicitly, by telling them to do so, or implicitly, by agreeing to a pension lifestyle.

QrizB said:

loveprada said:

In the meantime the value of the pension pot has halved since January 22.

This seems quite odd.

What fund(s) is your pension invested in? Have there been any changes over that period?

What was the value in January 2022, and what is the value today?

loveprada said:

I would have thought someone makes the decisions to switch, don't they have actuaries and connections in the city who they deal with? The transactions took place, somebody did it and made a bad call and obviously it will affect a lot of people, not just me.

Capita are not fund managers. If Capita moved your money, it will have been on your instructions - either explicitly, by telling them to do so, or implicitly, by agreeing to a pension lifestyle.

When I was intending to move the pension in January 22 it was worth around £21.5k but they had already taken a loss of 20%. Today it is £13k. So I realise that doesn't look like half but in 2021 presumably it reached a higher peak before it fell. They've sent me a spreadsheet with how they've moved it around in the last 3 years and everything they've done has taken a hit. For example In 2021 there was approximately £16k in Fixed Interest 60:40 and £5k in Deposit & Treasury. In 2022 that became £15k in Index Linked and £5k in Deposit & Treasury. In 2023 it was £10.5k in Index Linked and £3.7k in Deposit & Treasury. Does this help?

loveprada

Albermarle said:

loveprada said:

Marcon said:

loveprada said:

El_Torro said:

There seem to be various issues here.

Firstly what they invest in is decided by you, not Capita. If they have done lifestyling (i.e. selling equities and buying bonds as you get closer to your retirement age) then it's because that is the fund you chose. If you told them to switch it somewhere else and they didn't do it that's an issue. How did you tell them? Do you have an online account where you can view your investments? Or you told them on the phone? 

If the only option with Capita is to buy an annuity and not drawdown while staying invested then you can always switch provider. Ideally to one that lets you do what you want to do. 

As for the value of the investment: Stocks and shares investments have struggled in the last 18 months, especially those with high percentages of bonds and gilts. I don't know if a fund with 100% bonds would have lost 50% in value, on the face of it that sounds too much of a drop to me. 

As for your question about getting your money back: I don't see that happening, no matter how much you complain. Capita don't control the stock market, neither do they control what you choose to invest in. 

I recall a few years ago I received some paperwork asking me what I want to do and how I want to receive the pension. I called them and discussed this and told them I wanted to remain invested.  I've been very busy with other issues in my family dealing with cancer and my mother's dementia. I admit I didn't grasp the reins to keep logging on to see what was going on. In the meantime the value of the pension pot has halved since January 22. I've been emailing them and they seem to have an attitude that either things are done their way or not at all. They're not even blaming me for not managing my pension. They've made it clear their intention was to have palmed me off at age 60 and I've been overstaying my welcome! I'm pretty sure I can move the money to another provider but I dont have a clue what to do with it. 

With regard to your last sentence, no they don't control the stock market but they have made bad decisions with my money. Probably moved it after making a loss, then moved it elsewhere and made more losses.  How would you explain the number of units issue?

They haven't made any decisions with your money. It's invested in the funds you have chosen. Capita are your scheme administrators, not your financial advisers.

Is this a trust based occupational scheme (if so it'll have trustees), as opposed to some sort of group personal pension?

Thanks, yes I think it is trust based. I would have thought someone makes the decisions to switch, don't they have actuaries and connections in the city who they deal with? The transactions took place, somebody did it and made a bad call and obviously it will affect a lot of people, not just me.

If you want someone to make financial decisions for you, move investments around etc, you need to pay a financial advisor/investment manager. Capita are just an administrator ( albeit a not very good one) and will only change investments on your instructions, or as part of fixed  lifestyle plan.

Thank you. I've realised that too late.

loveprada

xylophone said:

Do you have a guide to this scheme?

Incidentally, have you obtained a stste pension forecast?

https://www.gov.uk/check-state-pension

Yes, I'm fully paid up to receive my state pension next year. Do you mean the guide to this workplace pension? I'm sure I do but probably didn't understand the jargon

woolly_wombat

Is it a defined benefit pension?
When you say your money has halved, do you mean the value of transferring out of a DB pension has halved?

QrizB

woolly_wombat said:

Is it a defined benefit pension?
When you say your money has halved, do you mean the value of transferring out of a DB pension has halved?

OP says:

loveprada said:

When I was intending to move the pension in January 22 it was worth around £21.5k but they had already taken a loss of 20%. Today it is £13k. So I realise that doesn't look like half but in 2021 presumably it reached a higher peak before it fell. They've sent me a spreadsheet with how they've moved it around in the last 3 years and everything they've done has taken a hit. For example In 2021 there was approximately £16k in Fixed Interest 60:40 and £5k in Deposit & Treasury. In 2022 that became £15k in Index Linked and £5k in Deposit & Treasury. In 2023 it was £10.5k in Index Linked and £3.7k in Deposit & Treasury. Does this help?

On the face of it, it looks as though the scheme was lifestyled to move into 25% cash, 75% bonds in preparation for taking TFLS and buying an annuity at the OP's declared retirement age (which may have been earlier than SPA). The OP didn't choose to do either and the funds have been sat there ever since.

It will have been affected by the bond/gilt price correction in 2022.

FWIW, if this post is accurate in 2021 a pot of £25k would have paid out £5k TFLS and the remainder would have bought an index-linked annuity of about £400 pa.

Today, the TFLS is £3.7k and £10.5k will buy an index-linked annuity of about £500 pa.

So, if the OP intends to buy an annuity, other than the smaller TFLS they're not really any worse off despite the fall in fund value.

If they *don't* intend to buy an annuity, they should really have changed their lifestyle fund a decade or more ago.

loveprada

OP says:

loveprada said:

When I was intending to move the pension in January 22 it was worth around £21.5k but they had already taken a loss of 20%. Today it is £13k. So I realise that doesn't look like half but in 2021 presumably it reached a higher peak before it fell. They've sent me a spreadsheet with how they've moved it around in the last 3 years and everything they've done has taken a hit. For example In 2021 there was approximately £16k in Fixed Interest 60:40 and £5k in Deposit & Treasury. In 2022 that became £15k in Index Linked and £5k in Deposit & Treasury. In 2023 it was £10.5k in Index Linked and £3.7k in Deposit & Treasury. Does this help?

On the face of it, it looks as though the scheme was lifestyled to move into 25% cash, 75% bonds in preparation for taking TFLS and buying an annuity at the OP's declared retirement age (which may have been earlier than SPA). The OP didn't choose to do either and the funds have been sat there ever since.

It will have been affected by the bond/gilt price correction in 2022.

FWIW, if this post is accurate in 2021 a pot of £25k would have paid out £5k TFLS and the remainder would have bought an index-linked annuity of about £400 pa.

Today, the TFLS is £3.7k and £10.5k will buy an index-linked annuity of about £500 pa.

So, if the OP intends to buy an annuity, other than the smaller TFLS they're not really any worse off despite the fall in fund value.

If they *don't* intend to buy an annuity, they should really have changed their lifestyle fund a decade or more ago.

Thank you for your explanation and you are correct. The annuity that was offered to me is around £500 pa guaranteed for 5 years so goodness knows what would happen after that and I'm not crazy about the idea of an annuity. I'm afraid my ignorance hasn't helped me. I would rather try to build it up but I dont know which way to turn, parhaps times are now too volatile to try to improve upon this?

QrizB

loveprada said:

The annuity that was offered to me is around £500 pa guaranteed for 5 years so goodness knows what would happen after that ...

"Guaranteed for five years" simply means that if you drop dead in the first five years, someone (most likely someone you nominate) will continue to receive the payments until five yeas are up.

If you make it through the first five years, it will continue to pay you but will cease on your death.

loveprada said:

I would rather try to build it up but I dont know which way to turn, parhaps times are now too volatile to try to improve upon this?

Let's take a step back and start with the basics.

How old are you now? At what age do you hope to retire? And how do you intend to fund your retirement? Are you expecting a full state pension? Do you have other pensions other than this one (I think you do, from your earlier mention of trying to "consolidate my pensions")?

loveprada

QrizB said:

loveprada said:

The annuity that was offered to me is around £500 pa guaranteed for 5 years so goodness knows what would happen after that ...

"Guaranteed for five years" simply means that if you drop dead in the first five years, someone (most likely someone you nominate) will continue to receive the payments until five yeas are up.

If you make it through the first five years, it will continue to pay you but will cease on your death.

loveprada said:

I would rather try to build it up but I dont know which way to turn, parhaps times are now too volatile to try to improve upon this?

Let's take a step back and start with the basics.

How old are you now? At what age do you hope to retire? And how do you intend to fund your retirement? Are you expecting a full state pension? Do you have other pensions other than this one (I think you do, from your earlier mention of trying to "consolidate my pensions")?

I'm 65 and not working so I'm effectively retired already. When you say fund your retirement - I can only rely on my state pension, my workplace pensions and my savings. The two pension pots that I did consolidate via a financial advisor into a SIPP have only incurred losses for me since November 2021 so I'm not doing too well but that is another sorry saga.