How to choose
Everybody’s different and your circumstances may well change over time, so there are no hard and fast rules for investing into a pension.
Put simply, the more risk you take the more your pension pot may grow – or fall – in value. You should expect investments to rise in value in the long term but can also fall in value. This is why you should invest your money in a pension pot for at least ten years, so it has more chance to recover any losses.
To work out how to invest your pension, you need to consider these three points:
When you plan to retire and how you want to take your pension
How much risk you want
Once you’ve considered these three key points, your money can be invested. Don’t worry, you can change your mind about your investment choice at any time.
Your personal circumstances
To start with, try answering these questions:
- Do you have other investments or savings to live on?
- How long do you want to invest for? If you have an existing Scottish Widows pension and are planning to take your pension or any tax-free cash in less than a year from now, call us to discuss your options. If you don’t have a pension with us, you can set up a Retirement Account online and then call us when you’re ready to take your money.
- Are you happy to take a long-term view and not worry about short-term dips in the value of your pension pot?
- What would happen if your pension pot dropped dramatically in value?
- Are you comfortable with taking some risk to potentially increase growth, or would you rather minimise the risk as much as you can?
For most people it will be a bit of a balancing act. But our investment choices are designed to help you find something that is right for you.