Sumary of Is your work pension fund up to scratch? How to tell if it’s a duffer:
- Six ways to tell if your retirement savings are in a duff investment fundBy Tanya Jefferies for Thisismoney.
- uk Published: 07:14 BST, 18 July 2014 | Updated: 08:51 BST, 21 July 2014 19 View comments If you signed up to a work pension scheme then took no further action, your retirement savings are most likely sitting in what is known as a ‘default’ investment fund.
- These are chosen for the workplace as a whole, and tend to play investments safe because your employer doesn’t want to get blamed for costly mistakes that endanger their staff’s pension savings.
- So how do you find out what investment fund your money’s in and whether it’s any good?
- Daily grind: Are your pension savings in an investment fund with the kind of performance that makes it all worth while in the end?
- Now final salary pension schemes are going or gone, phased out or closed by employers unwilling to bear the cost or risk, most workers are parked instead in so-called money-purchase pension schemes and carry the investment risk themselves.
- This gives workers important decision-making power over their investments – but in practice some 80-90 per cent simply let their money go in an employer’s ‘default’ fund and let financial professionals make the calls.
- Employers tend to stick with an investment strategy that applies to all staff, and doesn’t carry the threat of big losses.