Pension Decision?

rob78

Hi I have a stakeholder pension through my work. I currently have a around 20 thousand invested. I have 34 years until I am 65 and retiring. My contributions are currenlty buying/being invested im 50% UK Equity and 50% with profits. My pension advisor told me I should change to 100% UK equity as I would gain more, is this good advice? I am not sure what to do I dont want to gamble too much but at the same time I want a decent return on my money? Any Advice would be appreciated. Thanks.

dunstonh

I have 34 years until I am 65 and retiring.

Do note that your state retirement age is not 65. It will be 67.

My pension advisor told me I should change to 100% UK equity as I would gain more, is this good advice?

Maybe. Maybe not. Its certainly a better option than you have at the moment but its 100% into UK equity and single fund investing is old fashioned and results in lower returns over the long run.

Problem is that you have a stakeholder pension so the fund range isnt going to be very good. Indeed, there may not be that many alternatives and the adviser has to pick 100% UK equity. However, if there are alternative funds covering other sectors then they should be utilised as well and the overall spread should be averaged out to match your risk profile.

am not sure what to do I dont want to gamble too much but at the same time I want a decent return on my money?

Remember investment risk is just one of the risks you have. You also have risk of inflation (lower risk investments or cash may not give real growth). You also have the risk of not hitting target. i.e. how much income do you want in retirement and how much are you paying each month to get that. you may need higher growth potential to achieve it which means using higher risk funds.

rob78

Thanks for that as far as I know you are correct I only seem to have the option of leaving it 50 50 or changing to !00 uk equity. Should I cange it?