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How will my investments with Nest be affected by coronavirus?

Key points:

  • This article answers questions around your money invested with Nest.
  • The article also explains how coronavirus may impact your pension pot in the shorter-term.

Are my investments affected by the global impact of coronavirus?

  • Coronavirus (COVID-19) has affected markets and investments around the world. Our in-house investment team is closely monitoring how the pandemic is affecting the markets and the wider economy.
  • Our investment strategy is prepared for events like this and members should be reassured that their savings are in a strong position for the long term.
  • Our investment approach in our main funds is designed to smooth out some of the sharper ups and downs in the markets. We’re also constantly looking ahead for the best ways to protect your savings and help them grow.

Where is my pension pot invested?

  • You can find out where all our funds are invested by downloading our fund factsheets.
  • Most of our members are saving into our flagship Retirement Date Funds. These are invested in a way that aims to smooth out short term ups and downs. We spread your investments so they are less reliant on stocks and can benefit from different sources of income.
  • If you’ve chosen the Higher Risk Fund or the Sharia Fund, you might be seeing sharper falls in your pension pot right now. That’s because these funds are more heavily invested in stocks. However, it’s important to remember that pensions are long-term savings and we expect markets to recover when stability returns.

What is my pot worth now?

  • Simply log in to your Nest account to view the value of your pot.

Should I switch funds?

  • We can’t give financial advice but in these types of scenarios, the most sensible thing to do can often be to keep focused on the long-term goal and wait it out.
  • You might want to discuss your options with a financial adviser or The Pensions Advisory Service. You’ll find more information on our Guidance and advice webpage.

Markets are going down, what does this mean for savers?

  • Pensions are long-term savings so short-term changes may not affect what you could get when you retire.
  • Most Nest members are unlikely to experience a long-term impact from shorter-term market falls because they’re young enough to ride it out. If you’re closer to retirement and in one of our main Nest Retirement Date Funds, we’ll have taken steps to move your money out of the stock markets.

What if I am close to retirement?

If you’re closer to retirement and in one of our main Nest Retirement Date Funds, we would already have taken steps to move your money out of the stock markets as part of our lifestyling strategy. Our strategy is designed to help protect you from the possibility of big falls in value close to retirement, so your money wouldn’t have been as exposed to the stock markets and therefore wouldn’t have lost as much value during the recent period of volatility.

We understand your concern and we know how difficult this situation could be for some of our members. We would encourage you to seek support and advice from The Pensions Advisory Service for your specific circumstances.

How does coronavirus impact transfers?

Coronavirus has affected investments around the world, meaning markets could swing in price from day to day.

When you transfer your pension pot, all investments in your current scheme are sold at the market rate that day. The money is then used to buy different investments in your new pension scheme.

If markets move significantly during the time it takes to complete your transfer, you risk locking in any investment losses.

We’ve also seen a rise in scams linked to coronavirus. Our Pension scams and online security page has guidance on how to keep you and your pension pot safe during this time.

Before you transfer your pension we recommend you get free, impartial guidance from The Pensions Advisory Service or discuss your options with an FCA regulated financial adviser.

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