Sunday, January 17, 2021
  • About
  • Advertise
  • Careers
  • Contact
Pension Changes
  • Home
  • Government Policy
  • Pension Changes
  • Pension Information
  • Pension Rights
  • Retirement Pension
No Result
View All Result
Pension Changes
Home Pension Policy

Market reaction has dented many pension pots

May 1, 2020
in Pension Policy
0
SHARES
2
VIEWS
Share on FacebookShare on Twitter

For many newer investors, the recent stock market crash will be their first experience of a big fall in the value of their investments, and this may have dented their confidence.

Data from the latest Moneyfacts UK Personal Pension Trends Treasury report, showed the impact of the coronavirus pandemic on global stock markets had caused the average pension fund value to plummet by 15.2 per cent in Q1 2020, the worst quarterly performance on record, even surpassing the falls seen during the global financial crisis of 2008.

Related posts

Australia and Canada demand end to UK ‘frozen’ pensions

Australia and Canada demand end to UK ‘frozen’ pensions

January 15, 2021
British citizens in Canada ask government for help in pension fight

British citizens in Canada ask government for help in pension fight

January 12, 2021

So it is not surprising when Steve Webb, partner at consultancy LCP, says the biggest investor reaction he has seen is fear of further falls.  

“Although those who sell up now are crystallising their losses, some people are so afraid of further losses that they would prefer to get out of the market now, purely, so that they can be certain of where they stand,” Mr Webb adds.

As a result, advisers are working many hours to reassure clients and maintain continued communication with their clients.

Market stress

Andrew Dixon, head of wealth planning at Kleinwort Hambros, says although he is not seeing clients looking to de-risk their portfolios, he acknowledges “it is still early days”.

Mr Dixon adds: “Every adviser needs to really understand their client’s objective. If you are a long-term investor with no need to draw on your investments, the conversation is likely to be different to a client who is living off their investment income. 

“Inevitably, clients will want to talk about markets and the impact of Covid-19 but we also need to be clear with clients. We cannot control markets. 

“I think more productive conversations are focused on reminding clients of their objectives and what adjustments, if any, are necessary to achieve them in the timeline set.” 

In the wake of this crisis, it is possible a risk-adverse group of investors may emerge, as the reality that the world is more fragile than we may have thought, kicks in. 

Tom Conner, director at Drewberry, says for advised clients, it is very common to build in market crash scenarios to stress test the likelihood of achieving future goals, so there is still concern but to a lesser extent.

“They key message advisers need to be communicating to their clients right now is not to panic,” he says.

Clients will want to talk about markets and the impact of Covid-19 but we also need to be clear with clients. We cannot control markets.–Mr Dixon

Mr Conner points to one of the worst FTSE crashes in history, Black Monday in October 1987, to illustrate his point.

“By the end of the year, the FTSE was actually up by 6 per cent over the previous year,” he adds.

“Moreover, if you zoom out even further, taking a 30 year-plus horizon, you’ll see that the same ‘record’ crash is actually barely a blip overall.”

Long-term thinking

Pete Clancy, head of pension policy at Scottish Widows, adds: “Short-term ups and downs are to be expected and are a reminder to keep a long-term view on your investments where possible. 

— to www.ftadviser.com

Previous Post

Pension cuts coming? Supreme Court hears California rule case

Next Post

Moving insurance teams – the basic considerations and action plan

Next Post
EU Court to Consider if an Irish Pension can be Exempted from a UK Bankruptcy Estate

Moving insurance teams - the basic considerations and action plan

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

RECOMMENDED NEWS

TPO upholds complaint against South Wales Fire & Rescue Service

TPO upholds complaint against South Wales Fire & Rescue Service

7 months ago
Make a pledge to combat pension scams, industry urged by the Pensions Regulator

Make a pledge to combat pension scams, industry urged by the Pensions Regulator

2 months ago
OPINION Life itself is all that matters at the moment

OPINION Life itself is all that matters at the moment

10 months ago
Fitch, Moody’s provide differing views on California high court ruling

Fitch, Moody’s provide differing views on California high court ruling

5 months ago

FOLLOW US

  • 79 Followers
  • 27.6k Followers
  • 40.7k Subscribers

BROWSE BY CATEGORIES

  • Government Pension Policy
  • Pension Changes
  • Pension Information
  • Pension Policy
  • Pension Rights
  • Retirement Pension
  • Uncategorized

BROWSE BY TOPICS

2021 2021 Pensions auto-enrolment age 18 auto enrolment pension contributions 2021/22 auto enrolment rates 2020/21 auto enrolment rates 2021/22 cashing in pension at 55 cashing in pension calculator cashing in small pension pots CCP retirement check my state pension Disabled pensions drawdown employer pension contributions 2021/22 government policy examples uk list of government policies uk minimum pension contributions 2021 minimum pension contributions 2022 new state pension Pension age pension issues pension ombudsman pension plan pension regulator Pensions Advisory Service Pensions Brexit pension scheme uk Pensions outlook retirement 2 million scams scheme funding Single mothers pensions State Pension State Pension age state pension changes state pension forecast State Pensions State triple lock taking pension at 55 the pensions regulator Therese Coffey uk pension age UK State Pension uk state pension age what is government policy uk

POPULAR NEWS

  • Multiemployer pension reform not happening this year

    Multiemployer pension reform not happening this year

    5 shares
    Share 0 Tweet 0
  • Exit payment cap: Implications for the LGPS

    0 shares
    Share 0 Tweet 0
  • Public Service Pensions Update | October 2020

    0 shares
    Share 0 Tweet 0
  • NEST: More than a pension | Country Report

    0 shares
    Share 0 Tweet 0
  • Builders were not self-employed, rules employment tribunal

    0 shares
    Share 0 Tweet 0

Follow us on social media:

Recent News

  • Law, Practice and Precedents (8th Edition)
  • State pension payments can be received while working – will more tax need to be paid?
  • What is the average UK retirement income?

Category

  • Government Pension Policy
  • Pension Changes
  • Pension Information
  • Pension Policy
  • Pension Rights
  • Retirement Pension
  • Uncategorized

Recent News

Law, Practice and Precedents (8th Edition)

Law, Practice and Precedents (8th Edition)

January 15, 2021

State pension payments can be received while working – will more tax need to be paid?

January 15, 2021
  • About
  • Advertise
  • Careers
  • Contact

© 2020 Please contact us on partnership@pensionchanges.co.uk if you would like to reach our audience.

No Result
View All Result
  • Home

© 2020 Please contact us on partnership@pensionchanges.co.uk if you would like to reach our audience.