Pension Question

jomo061

I've had a company pension which I paid into for 7 years, I have now changed jobs to another company that has no pension plan, so I was thinking of setting up a personal one, anyway the question is.

I can move the money from my old company plan into my new personal one, or I can leave it with the current company without making further payments, until it matures on retirement and in parallel open a new personal one, with a loss of about 30% of my current pension due to the current market, is it best to leave it where it is, hoping that over time it will gain back the loss and more, or should I move to my new pension plan?

broker2008

Have a look at the options available to you under your existing scheme. There is some good information on the pensionboard website. Be careful about what you do with the fund. If you have lost 30% in these turbulent times, you might consider leaving in either the same fund or a similar fund so if the fund grows (I know I know) that you get some of the upswing. If you invest the transfer value of your old pension fund into say a PRSA, a similar fund might be worth looking into.

Drumpot

Like Broker 2008 said. Get your options from your existing Pension scheme (normally sent out to you upon leaving a company).

I assume it was a defined contribution scheme we are talking about as you say it lost 30% value.

Generally, its difficult to give advice when you havent discussed a persons own feelings towards risk and their own specific goals.

This is a general piece of advice intended to be taken as is stated . . It may not be relevant to all reading . .

I think there are two connected lines of thought on investments in markets. . .

What are your personal feelings towards risk (ie. how will media coverage affect your mood with regards to investing) . . .

and . . . .

Do you want to invest professionally for a quick return or long term return . . .

Well . . . . . . Mickey D . . . .

Have you considered what risks you are willing to take to improve your own pension performance?

What are your feelings towards risk ? Will you be reading the papers every day and watching the news saying "oh dear god, whats happening to my investment?" or will you let your investment lie and give it time to mature?

Given your near retirement age, the general consensus would be that you should stay on the side of caution. Keep cool. The reason people continue to lose money on their investments now is because either they are greedy (and ignorant), they are happy enough to let their investment recover, dont understand how their investment works or are worried about missing the upturn. At your stage (assuming you are 5 years or less from retirement) you should be only thinking about what you require at retirement, not what you can potentially make between now and retirement. There could be a recession for the next 20 years or we could see an upshot in the next 2 years, what is your future worth betting on?

Forget about what you want to have, focus on what you have, too many people are focusing on the wrong things . . Just work with what you have and make the most out of it .

I do believe in the annoying concept of "consolidating your loses" but think in the case of people coming closer to retirememt that they should be more concerned with the maximum that they can assure themselves when they eventually finish up working (forget about lulling over what you had last year). Forget about what you could of had and focus on what you have and what you realistically wish to have . .

Investment performance, whether it be pension or regular investment, is not dependant on what you expect, more what you have decided is an exceptable level of risk. . . It doesnt matter how well or bad your investment performs, its actually your expectation thats most important. . .

The question isnt really "What should I invest in", more " what should I invest in, given the fact that my risk profile is . . . . "

I personally believe that anybody willing to invest in anything other then Deposits should ask themselves , "what can I afford to lose" . . .

It may sound daft to the average Joe, but its something that most people dont consider when investing in anything other then Deposit funds . . .