How coronavirus (COVID-19) may affect your pension savings

Global financial markets are currently volatile because of fears about the spread of coronavirus. It’s likely the value of your pension savings will continue to go up and down a lot over the coming weeks.We will use this page to keep you updated and answer any frequently asked questions.

A pension is a long-term investment

It’s important to remember that your pension is a long-term investment and that it’s normal to see the value of your savings go up and down in the short term.

If you are a younger saver and you are concerned about the effect on your pension in the short term, please remember that there is plenty of time for a market correction and for your savings to grow.

If you are approaching retirement and you are concerned about your pension savings falling in value, please note that our model investment strategy is designed to protect your money as you approach your selected retirement age. When you get closer to your retirement age, we will start to move your money into lower-risk funds so that your pension savings become less likely to fall in value. Although we can’t guarantee that the value of your pension savings won’t go down in value when they are invested in these lower risk funds, they are less likely to.

What are my pension savings worth now?

If you would like to see the current value of your pension savings, sign in to your Smart Pension account using the button below.

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Should I change my investment strategy?

No one knows what the full impact of the coronavirus outbreak will be. While it can be tempting to make decisions about your pension based on short-term market conditions, it may not be in your best interest to do so.

If you’re thinking about changing your investment strategy or taking money out of your pension, we recommend that you speak to a financial adviser first.

You can find out more about our investment strategies in our investment guide. You can find this by signing in to your Smart Pension account, clicking Funds and selecting Investment help.

Beware of pension scams

In these times of uncertainty, you need to be extra careful not to be lured by pension scammers. They may offer you the opportunity of safe havens or promise better returns. We recommend you exercise extreme caution if you are asked to transfer your pension savings.

To find out more information, visit ScamSmart which has specific guidance related to coronavirus.

Where you can find further help

Need some help?

What happens to my pension contribution if I become a furloughed worker?

If your employer is paying into a qualifying pension scheme over the period you are a furloughed worker, you will receive the equivalent of your employer’s contribution to your pension savings from the UK government. However, this will be on the minimum automatic enrolment employer rate, most likely at 3% of your qualifying earnings.

The government is introducing changes to its furlough arrangements from 1 July 2020, including the flexibility to work on a part-time basis for your employer on a pro-rated salary. They are also asking employers to pay the minimum contribution to your pension savings rather than the UK government from 1 August 2020.

You can find more information about these changes on The Pensions Regulator’s website.

When will the furlough arrangements end?

The furlough arrangements currently put in place by the government are due to end on 31 October 2020.

What happens if I am nearing retirement?

If you are approaching retirement and you are concerned about your pension savings falling in value, please note that our model investment strategy is designed to protect your money as you approach your selected retirement age. When you get closer to your retirement age, we will start to move your money into lower-risk funds so that your pension savings become less likely to fall in value. Although we can’t guarantee that the value of your pension savings won’t go down in value when they are invested in these lower risk funds, they are less likely to.

You find more information about your investment options by reading your investment guide. Just sign in to your Smart Pension account, click Funds and then Investment help.

Should I transfer my pension savings?

In these times of uncertainty, you need to be extra careful not to be lured by pension scammers. They may offer you the opportunity of safe havens or promise better returns. We recommend you exercise extreme caution if you are asked to transfer your pension savings.

To find out more information, visit ScamSmart which has specific guidance related to coronavirus.

Should I change my investment strategy?

No one knows what the full impact of the coronavirus outbreak will be. While it can be tempting to make decisions about your pension based on short-term market conditions, it may not be in your best interest to do so.

If you’re thinking about changing your investment strategy or taking money out of your pension, we recommend that you speak to a financial adviser first.

You can find out more about our investment strategies in our investment guide. You can find this by signing in to your Smart Pension account, clicking Funds and selecting Investment help.

How do I protect myself from pension scams?

In these times of uncertainty, you need to be extra careful not to be lured by pension scammers. Unfortunately, they see this as an opportunity to try and con people into transferring their pension savings into ‘safe havens’. You are in danger of losing some or all of your money if you are tricked into doing this.

It is illegal to cold call someone about their pension savings so if you get one, you should hang up immediately.

For more information about how to protect yourself against scams and the things you should look out for, visit ScamSmart