‘I’m addicted to checking my retirement fund but it makes me anxious’

QI am retired, and I check my online pension about three times a day. It makes me anxious when I see the fund value drop even slightly. I am aware that values change, but I am trying to plan my retirement and how I take an income, and these fluctuations can have an impact on my workings for how much I can take and when. I would actually say I am a bit addicted to checking my pension.

How often is it advisable to check it, and is there actually a point where it’s reasonable to panic?

– Peter

A

“Pension addiction” is a thing. We live in a world where more people are retiring with defined contribution ( DC) pensions, which

Dear Peter

change in value according to the investments held within them, unlike the defined benefit ( DB) kind, which pay a set amount and so do not come with the same anxiety.

With DC pensions, fund values mean a lot. If your pot size is modest and is all you have then, particularly right at the start of retirement, and especially among savers who have perhaps not been exposed to the vicissitudes of global stock markets before, fluctuations can produce an acute kind of stress. It can be stressful for anyone, even for seasoned investors and those with bigger pot sizes that mean they can afford to lose a few thousand pounds.

The constant fear that market fortunes may turn against you at the wrong time, such as just before a chunky withdrawal, together with the constant hope that the opposite might have occurred and now is the time to book that holiday, mean that pension management is about emotional management, too.

Pension addiction comes about because the stakes are high. It’s also partly a result of awareness that you have to manage your pension on your own (if you don’t have an adviser). This can come with a feeling that you don’t know what you are doing and that you have no power over it anyway.

You become acutely aware this pot has to last an indeterminate amount of time. You become aware that real world things you want or need in the coming years correlate with an amount that can disappear from or appear in your pot in a single day – a new car, for example. And you become aware there are so many “what ifs”. What if I live to 110? What if the roof collapses and needs £30,000 of repair work? What if there’s a stock market crash right before I take out my 25pc tax-free lump sum?

Watching a pot rise and fall daily only contributes to an often mortifying realisation that even small sounding percentage changes can make a big difference to your financial outlook.

I hear more and more people say they feel like they are checking their pension way too often, but they can’t help themselves. They are fascinated, hopeful and scared. It’s also so much easier to check

‘You become acutely aware that your pension pot has to last an indeterminate amount of time’ in on your pension these days, with online and app- based access being increasingly common. Transparency and access are a good thing, and important, but if we struggle to tolerate risk and haven’t mastered the ability to rationalise market ups and downs as normal and to be expected over the long term, then obsessing and feeling emotional can become normal, too – and that’s less of a good thing.

Being completely dependent on the stock market can feel scary because we have no control over it. So, to echo the advice you might get from a therapist when you feel your life isn’t in your own hands, it can be helpful to focus on the things about your pension that you can control: the fees, the investment plan and how much you are withdrawing.

Keeping things as tax-efficient as possible is another thing that can be beneficial. Doing your homework on things like managing risk in drawdown may be a better use of time than repeatedly checking in on your fund value. Then, once you’ve nailed the controllables, you may feel less concerned by what you can truly do nothing about. In terms of how often is the right amount to check your pension value, I’d say daily, or multiple times a day, is too often. If you are still building up your pension through work, then annually may be enough. If you are approaching retirement, you would want to check in a bit more frequently, particularly if you are making efforts to boost your pot size, or if you are thinking about how much to move into drawdown, and when.

Being dependent on a defined contribution pension is an exercise in composure. And if you must check every day, you may need lots of it.

Becky O’Connor is director of public affairs for PensionBee, the online pension provider. Write to Pensions Doctor with your pension problem: Email questions to

pensionsdoctor@telegraph.co.uk.

Experts advise retirees to keep a pension as tax-efficient as possible to feel in control