Can my personal pension lose money?

I’ve recently found out how much I have in my pension think it might be sufficient but it is very tight. I’m a few years away from retirement and worried it could go down. Can pensions go down or only up?

Question asked by Shane Goodman
Are You Pension Happy?
Call us on 02084327334
I know how much my pension is worth
I know how much my pension costs
I have clear financial goals for my retirement

Answered by Andrew Jenkinson

Final Salary Pensions

Pension benefits held in a final salary scheme are protected by the Pension Protection Fund (PPF) which means you will benefit from pension compensation payments if your employer runs into financial difficulties. You’ll usually get 100% compensation if you’ve reached the scheme’s pension age, or 90% if you’re below the scheme’s pension age.

Defined Contribution Pensions

If you hold a money purchase pension, there is a risk that the fund(s) your pension invests in could fall in value depending on how the underlying assets perform. Before investing in a particular fund, look at the track record of the fund and sector. This will give you an indication of the volatility of the sector. Remember that past performance is no guarantee of future performance.

If you are unsure it often makes sense to speak to a specialist pension adviser. If you’re concerned about your pension losing money before retirement then your adviser may suggest less volatile funds, such as a bond or cash fund (some pension schemes include what is called ‘lifestyling’ which automatically reduces the risk profile of your funds as you approach retirement).

If your pension provider can’t pay you because it’s in financial trouble, provided it is authorised by the Financial Conduct Authority (FCA), you can get compensation from the Financial Services Compensation Scheme (FSCS).

pension lose money
defined contribution pension
defined benefit pension
This information does not constitute financial or other professional advice. You should consult your professional adviser or contact us directly on 02084327333 should you require financial advice. It is important to ensure any insurance policy you take out is suitable for your needs.
Start your journey today...
  Find out how a Drewberry financial adviser can help you reach your destination by making the most of your finances.
Call us on 

Frequently Asked Pensions Advice Questions

I’m looking to start up a pension, but all I can seem to find are defined contribution pensions....
I’m not in particularly good health and a friend said I may be better off with an enhanced annuity....
Given all the talk in the budget around the changes to the pension legislation and the introduction of...
I know I had a pension with my first employer, but I don’t know who it was with or where any of...
Need Help? Live chat now and get an instant answer from our Experts...


Our Latest Reviews
Matthew Draper

Excellent service at convenient times of the day specified by me. All product options were clearly outlined and I am very pleased.

Paul Devine

First class service. Helped me through the process from start to finish. Egle and Francis were very professional and talked me though all my options. Once the policies were set up, the after care after was also first class. Highly recommend. 5 stars all day long.

Josip Marjanovich

Victoria was very helpful about selection of suitable insurance. She always answered all questions in a timely manner.

We are rated 4.9/5 based on 1512 independent client reviews.
To read more of our independent client reviews click here →
4.93 / 5 Average
652 Reviews
Verified Buyer
Overall Rating
The whole process was a pleasure. Drewberry we're easy to deal with, polite, knowledgeable and helpful
Verified Buyer
Overall Rating
Very good, clear service would recommend to friends and family
Overall Rating
Sam Carr provided an efficient and professional service.
Verified Buyer
Overall Rating
Sam Carr provided a professional but enthusiastic service and helped make the whole process very straight forward. Goodness knows I have been through enough application forms recently. My insurance product was never going to be easy to find and I had been rejected on a number of other occasions through others ironically due to well managed common health conditions. I identified Drewberry in a last and disappointing trawl on th web to find someone that actually wanted to take on a difficult case like me. Some brokers wouldn't even consider me. When we applied for my first choice product Sam wasn't at all deterred by the long wait for my GP report or the final rejection that came back from the insurer, sadly I have become used to it. Within a day he had lined up the second choice and to my surprise he had hit the nail on the head and introduced me to the correct insurer and terms for my needs whilst nogotiating an excellent premium. I am extremely satisfied with what Sam has achieved for me and I would have no hesitation in recommending either him or Drewberry to friends, family and and business contacts. In the future, Drewberry will be my first point of contact. Many thanks!
Overall Rating
Tailored to my need and the staff gave very good service