How to manage your pension at this unstable time

Q

WHAT happens to my pension if I lose my job?

A

IF you’re made redundant as a result of Covid-19, you will no longer pay into your current workplace pension.

It’s important to think about the longer term and to ensure you put in a claim for benefits while unemployed, so you get National Insurance credits to keep state pension entitlement.

Q

HOW will my pension be affected if I’ve been furloughed?

A

YOU will still be required to pay into your workplace pension, but the amount will be reduced, based on the level of pay you get while furloughed. Under auto-enrolment, your employer will also continue to pay in a percentage of your current pay.

Q

SHOULD I lower my pension contributions to save money?

A

AFFORDABILITY is a key issue at a time like this – but on the flip side many would say the best time to buy investments is when their value has fallen, such as in the current market.

If you are struggling to make contributions you can reduce them or take a contribution holiday, but you should consider your options carefully and understand the longer term effect they will have on your pension income.

Q

MY pension has dropped in value, what should I do?

A

IT’S worth remembering a pension is a long-term savings investment and over the years the value will go up and down.

The coronavirus has had a big impact on the investment market, leading to significant and irregular ups and downs in values. A natural first instinct would be to consider moving your pension money to a lower risk fund, however these funds generally have a lower potential for growth long term. If you are planning to make changes, ensure you do so with clear objectives and always considering the long-term implications.

Q

I’M about to retire, should I wait until the value of my pension funds