Should I change pension provider?

greencode

I was very very late to getting a pension (I know, I know!). I'm 49 and have £62,000 in my pension. I'm putting in £500 a month but what I'm disappointed with is I've been using a pension company for 3 years now and my gain is only £4,200. There were originally 3 levels of risk and I originally went with medium risk but since last year I've gone on to the high risk option.

I have a meeting with them next week to discuss how it's going but unsure exactly how it is going! That much over 3 years doesn't seem much.

Any ideas or help would be greatly appreciated as I do find pensions incredibly complicated.

dunstonh

 but what I'm disappointed with is I've been using a pension company for 3 years now and my gain is only £4,200

Being disappointed doesn't mean it's doing badly.    
For example from November 2021 through to October 2023, low risk investments lost value.   High risk investments did ok.

So, if your investment selection is low risk then you would likely have been loss making or fairly flat but if higher risk then you should see some good profit.

I have a meeting with them next week to discuss how it's going but unsure exactly how it is going! That much over 3 years doesn't seem much.

A cycle is around 15 years nowadays.   you have been invested just 3 years and in that three year period we have had an ongoing war in Europe,  Energy crisis, gilts crisis (worst in over 100 years) and an inflation spike.    
2021 was positive, 2022 was negative.  2023 was flat until the final quarter. 2024 is up with equities but flat with bonds.

The reason you are told that investing needs a long term view is for this very reason.    You will get good years, bad years and nothing years.     Three years is too short term to be either disappointed or pleased.    

Linton

The last 3 years have been difficult for many people especially if they hold a significant % of bonds.  As others will tell you your returns are primarily dependent on which funds you use, much more so than which pension company is chosen

I am not sure that the pension company can tell you very much useful. In particular they will not be authorised to advise on your particular circumstances

Are you employed and if so are you a member of the employer pension scheme? £62K is not a large pot - it would easily have been accumulated in less than 10 years.  Perhaps you should be contributing more.

Can you tell us in which funds you have been investing in and perhaps we can give the background to their performance.

Albermarle

I have a meeting with them next week to discuss how it's going but unsure exactly how it is going! 

It would be rather unusual to have a meeting with your pension provider, unless you are paying extra for financial advice with them ?

A medium risk fund would typically have gone up between zero and 8% over the last 3 years, so you are about in the middle.
A higher risk fund would have gone up more, but over the next 3 years it might be the other way around ( or not )

LHW99

Also, only £500 would have been invested for a full 3 years, 2 x £500 for 2 years 11 months, 3 x £500 for 2 years 10 months......

JohnWinder

for 3 years now and my gain is only £4,200. There were originally 3 levels of risk and I originally went with medium risk but since last year I've gone on to the high risk option.....
Any ideas or help would be greatly appreciated as I do find pensions incredibly complicated.

The investment aspect of pensions isn’t too complicated, try this:
1. The stocks, bonds, (gold, property etc) markets reward investors over long-ish terms (our lifetimes or less) but there can be losses short term (2022 was a shocker).
2. Investing in easily identified funds which accurately reflect those stock, bond etc markets will provide you with the returns of those markets. It can end there if you’re happy with that.
3. If you want to try for better than market returns, choose other funds, but the choice is huge and no one knows how to identify those winners in advance. Such investing brings the risk of getting worse than market returns which were easily achieved in #2. That might partly explain your results as might #1. It's usually not a better approach than #2.
4. We have to take more risks to get better returns; that’s the reward for the risk. But sadly, taking more risk does not ensure better returns, because if better returns were assured then it wouldn’t be more risky. Choose a risk level for your comfort and circumstances; going above that risk level to chase better returns might not achieve those returns and result in tears.
5. Of all the assets to invest in, a mix of stocks, bonds and cash gives the best bang for your buck, the proportions depending on your circumstances (could be 100/0/0 or 20/60/20 etc). You can ignore gold etc.