Pension lost £25,000 in 2022

[talkingfarm]

Ahhhh not sure what to do - since my divorce my pensions have been managed by a single company.

They grew by £13k in 2021, but are down by £25k in 2022. I work full time and pay in 8% of my salary, plus 6% from employer.

So to be this far down is horrendous - I will speak to them about it, but I'm sure they'll say 'market conditions'

Total fund value is only £80k, so these are massive losses.

Just wanted to sense check if this seems normal- and do you think there's any way I'd get my money back?

We are with Royal London, their fees are low, we invested in September, with 10% less than we had saved over twenty years (Thanks to Kwasi Carcrash) we deliberately didn’t look at the app until last week, the fund has been up and down like a dog with fleas, which has been a good lesson in volatility.

Royal London are one of the few mutuals left.

Apart from investments, I am not connected to Royal London.

Just checked my Nest pension and it's almost fully recovered from March last year. Checked our company investments (all low cost trackers) and they have recovered and are up by about 6%, at their worse they had fallen by about 8%.

You're doing the right thing contributing to a pension. It's best not to watch it week-to-week, or even month-to-month. Nut over the years and decades your contributions, employer matching contributions, and tax-free compound growth will work their magic and you'll eventually have a surprisingly large fund that will give you lots of options in retirement.

It is known to be one of the hardest things to do - to defer spending now and lock in benefits for later. So well done for making decent contributions, and try not to stress out about a bad year in the stock market. There'll be more good years than bad over most people's working lifetimes. There has never been a single ten-year stretch in the last 100 years that the stock market hasn't out-performed other forms of saving - so keep your faith and keep going!

Also interested to hear about st James place…

Their fees are very high, from memory.

Your investments during the period the fund decreases in value are not wasted money.

Your posts indicate you know very little about pensions and investing.

Increasing your investment whilst market conditions are poor is actually a good thing as it brings down the average cost of your investment, and when the market starts to recover your pot will grow more than it would have done if the funds hadn't have dropped in value.

Ride out the storm, it is what it is, markets go through bull and bear cycles. As PP has said blame Truss and Kwarteng, they have done years worth of damage in a few weeks.

Pensions are a long term game, unless you're planning to retire in the next few years you'll be fine, switching funds after a massive loss is not the right thing to do, it will recover.

I was on my pension App (Aviva) yesterday for other reasons, also mine had huge dip in 2022, but it's recovering strongly already (phew). I want hands-off investment style, I don't think me micromanaging would make it perform better.

Is it your own private pension that the company contributes to rather than a company fund you’re enrolled in?

@talkingfarm

I'd definitely buy some vanguards funds right now because everything looks like its easing again.. Buy now before the jump.

Ok thanks a lot @Floofyduffypuddy!

I second Vanguard.
I have some money in their stocks and shares ISA, 50% in one of their life strategy (ready made) funds and the other 50% in some of their ETFs.
Its doing nicely at the moment.

I heartily recommend Royal London.

Vanguard is good and cheap although you can only invest in their own funds. Interactive investor is also good and cheap (fixed price so better for larger amounts) and has a wider range of investments. There are good videos on YouTube such as Meaningful Money as previously mentioned. I would avoid St James Place as they are expensive and only access limited funds (they are not independent) and usually ones the luckily enough for them pay them a nice commission. If you must take advice use an IFA and preferably one that charges by the hour rather than a % of your investment. You can't control or predict performance but you can make sure charges are as low as possible.

You can buy vanguard stuff through other places I have vanguard and other stuff from haegrves

I really hope so. DH has lost so much in the last year or so,. It frightens me.

I've bought Vanguard shares on the interactive investor website - it's not doing as well as other low-cost trackers though - swings and roundabouts.

Try and think about it this way, the contributions you have made when prices were lower have bought more units, so when things improve you will get a better return. In an ideal world the market would be very low for the years you contribute and increase massively just before you retire...

My SandS ISA was worth less than I had paid into it late last year but I looked today and it is now worth about 4% more than I paid in. They do bounce about.

No one really knows when is a good time to buy or sell (although there are plenty of companies that give the impression that they can!) which is why index funds generally outperform over time, once fees are taken into account. As the expression goes, it not about timing the market but time in the market. If you stick with it you really can make a lot of money.

I find it really scary that my workplace pension (with Aviva) is still dropping like a stone. It's lost almost all last month's contribution, same as it has been doing every month for the past year. I thought the worst was meant to be over!

My two stocks and shares ISAs have been recovering nicely since new year, so why is the pension still plummeting?

They will be invested in different funds. Some can do well while others do poorly. Hopefully over the longer term they will all provide you with good returns.

Just as an example even if you have passive tracker funds you could have one tracking the FTSE 100 and another tracking the NASDAQ. The latter contains mainly technology companies like Tesla, Amazon and Apple whilst the FTSE contains a wider range of companies like BP, Next and HSBC. On any given day or period one fund could do well and the other poorly. Over the long term you'd expect both to deliver positive returns.