Capita workplace pension - huge loss

MallyGirl

loveprada said:

dunstonh said:

 Question is where and who can I trust if I use a IFA.

To be honest, you are not in IFA territory.     I suspect the vast majority would not offer their services to you.

 I did use one a couple of years ago and the guy is either an idiot or a spiv, as I lost 30k from the very first moment, it was losing money at the rate of say at least £1k a week and he did !!!!!! all to stem the flow.

Why would you expect an adviser to make changes?      The only negative period close to a couple of years ago was Spring 2020 when coronavirus lockdowns hit.  Markets fell sharply over a period of one month.  By late summer of that year, they were higher again.          If they adviser had pulled you out whilst it was falling, you would have missed out on the recovery and ended up with a worse outcome.      The adviser sensibly did nothing as would be expected.    

However, your figures do not add up.  Losing £30k from the very first moment would require a  fund value of around £100k+.   £1k a week losses for four weeks would not match the way the falls occured in Spring 2020.

 I've raised a complaint with the FSA Ombudsman and ditched him. Beggars belief that he was recommended to me personally by someone who has been invested with him for 25 years. Things aren't going well for me.

The Food Standards Agency is not an Ombudsman    Perhaps you meant the FOS.  However, the FOS cannot review a complaint until you have complained to the firm and they have responded and if you still disagree with it.     However, the loss period in 2020 recovered within 6 months.  So, complaining now about a loss in 2020 that recovered before the end of 2020 seems utterly pointless.    

have you considered that the reason things are not going well for you is you?   i.e. your lack of knowledge and understanding?    Not knowing and understanding things is quite normal but if it is causing you to make bad decisions or act in a way that is not healthy, then the best thing to do is learn about it and begin to understand.

At the moment, you are making accusations of wrongdoing but there appears to be none.   If you understood it more, then you would come to realise that and knowledge leads to better decision making.

Sorry for the wrong acronyms, I did mean the Financial Services Ombudsman. Yes I did lose £30k between November 21 to around Summer 22. It has improved slightly at least as my current losses are £23k which is still bad, yes there was over £100k invested. Yes it was my naivety that led me down this path. If you say that no IFA would have taken me on then this guy who did must have had a rogue mentality. Can you guide as to what I should be reading for a better understanding of what is going on? Also would you say the funds I'm in at the moment are probably not going to rise again? Maybe they are exposed to the same bond issues?

The comment about not being in IFA territory relates to your pot of £21k. It is too small for an IFA to be interested. If you have other funds in other investments/pensions etc and you are looking for advice on the whole lot then that might be a different matter.

In order to gain a bit of basic understanding I would suggest doing some reading.
A book I would recommend is 'DIY Pensions' by John Edwards - also the pensions section of his website Diy Investor http://diyinvestoruk.blogspot.co.uk/p/pension.html
He has also written books in Simple Investing and other financial concepts. They are quite often available on Kindle Unlimited. There are plenty of other books, blogs, and of course this site but getting the basics bedded in will help with understanding the material.

Pat38493

To add to MallyGirl's recommendations, if you want to find out more about basic DIY investing approaches, try the book "Smarter Investing" by Tim Hale.  It's often recommended on these boards and has some chapters that explains about the different types of investments you can use.

Bostonerimus1

artyboy said:

Bostonerimus1 said:

Linton said:

thriftytracey said:

My Royal London drawdown pension has lost £3500 in three weeks.  I've already reduced drawdown to 50% of what I used to draw.  

It's all very depressing.  A few months ago it was just about staying the same value despite drawdown.  

£3500 down out of how much?  £3500 out of £50K is possibly of some concern.  £3500 out of £500K is just noise.

How much are you withdrawing?  50% could be a major hit ;eaving you in poverty, and possibly an over-reaction.  On the opther hand it could be marginal compared with your other income.

Are you invested in appropriate funds for the level of drawdown? 

If people are drawing down from Gilts they are selling at a low point and so crystalizing their losses. So in drawdown it's good to have asset classes separated out so you can choose where to draw income. Multi-asset funds aren't ideal for drawdown as you can't choose the asset class you are selling. 

I'd love to know if that was actually true though, versus gilts just having been corrected down to more realistic levels, after their abnormal growth over the last 15ish years...

There have been a couple of threads recently on this subject, and at the risk of an over simplified summary, it seemed as though no one was suggesting there would be a major bounce back from this point, more a case of 'normal returns, normal volatility'.

in which case, it's not like selling is necessarily a bad thing if you find yourself in a situation where you held bonds you never really wanted in the first place...

The low is relative to the last decade. If people bought into Gilts/bonds at higher prices and are now selling they are making a loss so doing exactly what your shouldn't. If they have the time to sit on their bond funds they should recover or they could take advantage of today's interest rates and buy an annuity.

artyboy

Bostonerimus1 said:

artyboy said:

Bostonerimus1 said:

Linton said:

thriftytracey said:

My Royal London drawdown pension has lost £3500 in three weeks.  I've already reduced drawdown to 50% of what I used to draw.  

It's all very depressing.  A few months ago it was just about staying the same value despite drawdown.  

£3500 down out of how much?  £3500 out of £50K is possibly of some concern.  £3500 out of £500K is just noise.

How much are you withdrawing?  50% could be a major hit ;eaving you in poverty, and possibly an over-reaction.  On the opther hand it could be marginal compared with your other income.

Are you invested in appropriate funds for the level of drawdown? 

If people are drawing down from Gilts they are selling at a low point and so crystalizing their losses. So in drawdown it's good to have asset classes separated out so you can choose where to draw income. Multi-asset funds aren't ideal for drawdown as you can't choose the asset class you are selling. 

I'd love to know if that was actually true though, versus gilts just having been corrected down to more realistic levels, after their abnormal growth over the last 15ish years...

There have been a couple of threads recently on this subject, and at the risk of an over simplified summary, it seemed as though no one was suggesting there would be a major bounce back from this point, more a case of 'normal returns, normal volatility'.

in which case, it's not like selling is necessarily a bad thing if you find yourself in a situation where you held bonds you never really wanted in the first place...

The low is relative to the last decade. If people bought into Gilts/bonds at higher prices and are now selling they are making a loss so doing exactly what you're shouldn't. If they have the time to sit on their bond funds they should recover or they could take advantage of today's interest rates and buy an annuity.

If you're 'in' bonds because you want to and it's a conscious part of your investment strategy, then agreed. But where people have ended up in bonds through Lifestyling and inertia, then my question stands, is there likely to be any sort of 'bounce' that would justify hanging on a bit before moving them to a more suitable long term investment...?

Bostonerimus1

artyboy said:

Bostonerimus1 said:

artyboy said:

Bostonerimus1 said:

Linton said:

thriftytracey said:

My Royal London drawdown pension has lost £3500 in three weeks.  I've already reduced drawdown to 50% of what I used to draw.  

It's all very depressing.  A few months ago it was just about staying the same value despite drawdown.  

£3500 down out of how much?  £3500 out of £50K is possibly of some concern.  £3500 out of £500K is just noise.

How much are you withdrawing?  50% could be a major hit ;eaving you in poverty, and possibly an over-reaction.  On the opther hand it could be marginal compared with your other income.

Are you invested in appropriate funds for the level of drawdown? 

If people are drawing down from Gilts they are selling at a low point and so crystalizing their losses. So in drawdown it's good to have asset classes separated out so you can choose where to draw income. Multi-asset funds aren't ideal for drawdown as you can't choose the asset class you are selling. 

I'd love to know if that was actually true though, versus gilts just having been corrected down to more realistic levels, after their abnormal growth over the last 15ish years...

There have been a couple of threads recently on this subject, and at the risk of an over simplified summary, it seemed as though no one was suggesting there would be a major bounce back from this point, more a case of 'normal returns, normal volatility'.

in which case, it's not like selling is necessarily a bad thing if you find yourself in a situation where you held bonds you never really wanted in the first place...

The low is relative to the last decade. If people bought into Gilts/bonds at higher prices and are now selling they are making a loss so doing exactly what you're shouldn't. If they have the time to sit on their bond funds they should recover or they could take advantage of today's interest rates and buy an annuity.

If you're 'in' bonds because you want to and it's a conscious part of your investment strategy, then agreed. But where people have ended up in bonds through Lifestyling and inertia, then my question stands, is there likely to be any sort of 'bounce' that would justify hanging on a bit before moving them to a more suitable long term investment...?

Bonds will recover and there will be ups and downs in equities. People should have an asset allocation appropriate to their financial needs and goals. If they are in drawdown one strategy is to sell what's up, probably equities right now,  or they might convert some of the gilts to a annuity as the rates on those are up. If they are still accumulation the should probably be buying bonds to rebalance their portfolio. There's no magic bullet. 

dunstonh

thriftytracey said:

My Royal London drawdown pension has lost £3500 in three weeks.  I've already reduced drawdown to 50% of what I used to draw.  

It's all very depressing.  A few months ago it was just about staying the same value despite drawdown.  

Up until last week, the markets had fallen back to where they were around 7 weeks ago.  However, this week has been much better.    All pretty much normal volatility and nothing unusual.

I'd love to know if that was actually true though, versus gilts just having been corrected down to more realistic levels, after their abnormal growth over the last 15ish years...

Gilt fund values excluding income are back to around mid 90s values.   2022 and 2023 to some extent have seen the unwinding of the massive gains in unit prices following the credit crunch and a return to the ballpark they normally reside in.

QrizB

dunstonh said:

thriftytracey said:

My Royal London drawdown pension has lost £3500 in three weeks ...It's all very depressing

Up until last week, the markets had fallen back to where they were around 7 weeks ago.  However, this week has been much better.    All pretty much normal volatility and nothing unusual.

Yes, my DC pot is up ~2% since the 8th of August.

I'm not getting excited; it could lose multiples of that tomorrow.

Bostonerimus1

FYI, the 20% drops seen in some Gilt heavy portfolios are factored into the models for retirement drawdown. So if you are doing some version of a 4% with inflation strategy or a Guyton Klinger variable withdrawal strategy make sure you follow your rules.

atush

loveprada said:

Bostonerimus1 said:

QrizB said:

Bostonerimus1 said:

You need to find out how your money is being invested.

We know that; it was quoted a page or two back.

25% cash, 75% gilts/bonds.

OK, so that explains the large losses. Lots of people will be in a similar situation.

Bostonerimus1 said:

QrizB said:

Bostonerimus1 said:

You need to find out how your money is being invested.

We know that; it was quoted a page or two back.

25% cash, 75% gilts/bonds.

OK, so that explains the large losses. Lots of people will be in a similar situation.

Am I supposed to just take the hit? Is there any point in raising a complaint?

yes, you are supposed to take the hit for not turning off life styling.

Linton

Bostonerimus1 said:

artyboy said:

Bostonerimus1 said:

Linton said:

thriftytracey said:

My Royal London drawdown pension has lost £3500 in three weeks.  I've already reduced drawdown to 50% of what I used to draw.  

It's all very depressing.  A few months ago it was just about staying the same value despite drawdown.  

£3500 down out of how much?  £3500 out of £50K is possibly of some concern.  £3500 out of £500K is just noise.

How much are you withdrawing?  50% could be a major hit ;eaving you in poverty, and possibly an over-reaction.  On the opther hand it could be marginal compared with your other income.

Are you invested in appropriate funds for the level of drawdown? 

If people are drawing down from Gilts they are selling at a low point and so crystalizing their losses. So in drawdown it's good to have asset classes separated out so you can choose where to draw income. Multi-asset funds aren't ideal for drawdown as you can't choose the asset class you are selling. 

I'd love to know if that was actually true though, versus gilts just having been corrected down to more realistic levels, after their abnormal growth over the last 15ish years...

There have been a couple of threads recently on this subject, and at the risk of an over simplified summary, it seemed as though no one was suggesting there would be a major bounce back from this point, more a case of 'normal returns, normal volatility'.

in which case, it's not like selling is necessarily a bad thing if you find yourself in a situation where you held bonds you never really wanted in the first place...

The low is relative to the last decade. If people bought into Gilts/bonds at higher prices and are now selling they are making a loss so doing exactly what your shouldn't. If they have the time to sit on their bond funds they should recover or they could take advantage of today's interest rates and buy an annuity.

This equity argument does not apply to bonds.  WIth equity the expectation is that after a significant fall the market will recover in the short to medium term to its "fair price" thanks to a change in sentiment.  This is not the case for safe bonds.  Bond prices are mathematically tied into interest rates. They are always at the fair price.  The falls we have seen in the past year or so are the unwinding of 40 years of steadily decreasing interet rates falling to unprecedently low values.  

 The price of a bond bought more than a small number of years ago will only recover if interest rates freturn to near to zero.  This may well not happen in your lifetime. 

In terms of overall return, all bonds are erquivalent.   The price you paid for the bond is irrelevent. An old bond on which you made a large loss is no more likely to make a strong recovery than a new one you buy today.  There is no advantage in keeping them for the future.