25/09/2026
Most people with a UK pension have never chosen how it's invested. It was set up automatically when they started a job, a retirement date was entered, and the pension has been quietly managing itself ever since based on that date and a set of assumptions nobody ever asked them about.
One of the most common of those assumptions is called a lifestyle strategy. As you get closer to your selected retirement date, the pension automatically moves your money out of investments that can grow and into cash and bonds that are considered safer. On the surface that sounds sensible. The problem is that this strategy was designed decades ago for a completely different world, one where most people retired at 65, bought an annuity with their pot, and that was that.
Most people retiring today don't do that. They keep their money invested and draw from it over decades. Which means moving it into low growth assets ten years before retirement isn't protecting them. It's quietly costing them a significant amount of money during the years when their pot is at its largest and compounding could be doing its most valuable work.
The numbers in a recent FT Adviser article make this pretty clear. Someone contributing £500 a month over 40 years could end up with nearly £984,000 if their fund grew at 6% throughout. If growth dropped to 2% in the final ten years because of an automatic lifestyle switch, that figure drops to around £557,000. That's over £426,000 lost not because of a market crash but because of a default setting nobody ever reviewed.
If you have a UK pension and have never specifically chosen how it's invested or checked what your selected retirement date actually is, that's worth looking at before October brings any further changes.
Book a free thirty minute call below and we can take a look at what your pension is actually doing.
