Extremely disappointing workplace pension

pieroabcd

Hi,
one of the workplace pensions that I have (that i'm not contributing to anymore), a quite famous brand in the UK, over the years has shown an *extremely disappointing* performance,
In 6 years it has remained basically at the same value that I paid into it, that means that I'm losing money if I take inflation into account.
Every time that the markets dip it dips even faster, while every time that they rise it rises MUCH less. Basically it's reaping all the benefits for itself and offloading the burdens to people like me.

Another workplace pension that I have, instead, is performing much better (now it's around 14.7% higher after 2.5 years of contributions), but I prefer not to rely too much on a single provider.

Any advice on a similar pension provider that generally doesn't disappoint?

Thanks.

El_Torro

Similar questions have been popping up recently. The answer is essentially the same for all: The fund or funds you are invested in have a much bigger impact on the performance than the pension provider you are using.

If you look into how your pensions are invested you’ll probably find that the pension that is underperforming is low risk while the other is medium or high risk. Low risk funds have had a pretty rough time in the last couple of years and have lost more than medium or high risk funds. This is unusual, the sort of thing that doesn’t happen every decade. 

If you are looking for a fund that generally doesn’t disappoint then you might be looking for the holy grail, let us know if you find it. We can tell you which funds have performed best in the last few years, telling you which fund will perform best in the next few years is a lot trickier. 

Hoenir

Bottom line what really matters is what you are invested in. That's what will determine performance. Fund managers have a remit to operate under. If they say they are going to invest your money in apples that's what they'll do. However much the the price of banana's is rising expodentially. 

What's the name of the fund?  Will help us help you in a constructive manner. 

pieroabcd

I prefer not to make names.
I'll check the documents, but if my memory serves me we well the risk that I specified was medium, not low.

pieroabcd

Is it true -as someone told me- that when you don't pay anymore into the fund the provider changes how the money is invested? 
I thought that it was hearsay, but maybe there's some truth?

dunstonh

In 6 years it has remained basically at the same value that I paid into it, that means that I'm losing money if I take inflation into account.

A 6 year period that has had 5 events that would be considered generational.   Brexit,  Global Pandemic, a war in Europe, an energy crisis and high inflation.

Equities are up in that period.  Bonds are massively down.    You haven't said what you have invested in.  Only the fact its in a pension.  So, without knowing how you are invested, its difficult for anyone to comment.

Every time that the markets dip it dips even faster, while every time that they rise it rises MUCH less. Basically it's reaping all the benefits for itself and offloading the burdens to people like me.

What markets are you referring to as most stockmarkets are very up over the last 5 years.   Are you even invested much in the markets you are referring to?

Any advice on a similar pension provider that generally doesn't disappoint?

Why do you think it is the pension provider and not your investment choices?   The name on the paperwork isn't responsible for your returns.

Hoenir

pieroabcd said:

I prefer not to make names.
I'll check the documents, but if my memory serves me we well the risk that I specified was medium, not low.

No need to provide a name. Just the sectors the fund is invested in and in what %. 

Risk for broad based funds is measured in terms of volatility. Medium risk doesn't guarantee a better return than low risk over shorter time frames. A medium risk investment can in fact go down further if the markets invested in turn south than a "low" one.  

Hoenir

pieroabcd said:

Is it true -as someone told me- that when you don't pay anymore into the fund the provider changes how the money is invested? 
I thought that it was hearsay, but maybe there's some truth?

Fund provider will generally operate under your instructions. Unless the funds invested in have a default path as your choosen retirement date approaches. As it your money after all. Making involuntary changes would result in them ending up in hot water with the regulators. 

pieroabcd

This is what I can see in the summary page:
risk level: mid
40% intl.eqt
22% uk eqt
16% intl bonds
8% cash market
5% uk gilts
some other stuff, few items at less than 4% each.

Now it's 5% above the paid contributions. I thought that I had paid a bit more, but it's still far from being exciting.

dunstonh

but it's still far from being exciting.

Its never going to be exciting with that asset make up.

home bias in a period when UK equity has been poor.
low in global equity.

Now compare it to the fund that you say is doing well.

Marcon

pieroabcd said:

I prefer not to make names.
I'll check the documents, but if my memory serves me we well the risk that I specified was medium, not low.

Nobody knows who you are, whereas plenty of people here will be familiar with the provider/funds you are using. You'd get more help if you were more open, but of course that's your choice (but if you look at other posts, you'll quickly realise it's no big deal to name a scheme).