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Supporting you through
uncertain times
When there's a lot happening in the wider world, this can affect the financial markets - and in turn, your pension pot.
We’re here to support you, managing your money through the rises and falls of the financial markets. Our investment team work tirelessly on your behalf to monitor everything affecting your pension savings, identifying potential risks and taking steps to manage them.
Like all pensions, your Nest pension pot is invested in things like stocks, shares and property. These are known as financial markets. We pick markets that generally rise in price over the years, choosing the ones we think will make money for you.
The long-term rise of the financial markets can occasionally be interrupted by major events that create uncertainty, either within the UK or around the world. You may have noticed this after global conflict, political crises or energy shortages – or even recently after the US government introduced new trade tariffs on imports.
Uncertainty causes the price of markets to rise and fall unexpectedly, which could affect how much you have in your pension pot.
Remember, prices don’t tend to keep falling. Once the uncertainty is over, markets usually rise again – meaning your pot should too. This is a natural part of investing and is built into our strategy.
Our goal is to make sure that your pot grows enough to match or beat the rising cost of living over the many years or decades you’ll be saving with us, even after accounting for our charges.
For more information, explore our help centre article ‘What happens to my pension pot when there’s uncertainty in the financial markets?’.
As the UK’s largest workplace pension provider, we’re well placed to weather potential risks in the financial markets. See how our dedicated investment team carefully balances the need to grow your savings while protecting them from falls.
Compared to other providers, independent experts Defaqto found that we delivered consistently strong growth while taking less investment risk with your money, when looking at the average over the last 5 years.
One of the ways we do that is by investing your money into more markets than the average pension provider, helping to spread your risk across things like property, stocks and shares, infrastructure projects like bridges or windfarms and more.
You may have heard ‘inflation’ being discussed in the news lately. Inflation is a way of measuring the cost of everyday groceries and bills, otherwise known as the cost of living. When inflation is rising, it means everything is getting more expensive.
Inflation doesn’t just impact your day-to-day costs. It can also affect long-term savings like pensions. That’s why we work hard to grow your savings in line with the rising costs of living.
The cost of living crisis has the potential to affect financial markets, which in turn affect your pension savings. Our investment strategy is carefully designed to take these kinds of short-term issues into account, helping your pension pot weather the years or decades you'll be saving towards later life.
Over 99% of members like you are in one of our Nest Retirement Date Funds. These award-winning funds are designed to work for most people, but you can choose to invest for different beliefs, faiths or risk appetite.
We can’t give financial advice but we’d recommend that you discuss your options with a financial adviser or MoneyHelper. Remember, investors generally want to buy when the markets are low and sell when prices have risen. Switching from a higher risk fund to a lower risk one just after a market fall is like doing the opposite of that. You risk locking your losses in.
We recommend that you explore your choices and compare Nest’s different pension fund performance before you make any decisions.
Balancing contributions against your costs of living
When people are worried about making ends meet, it’s understandable that you’ll look at where you can cut your spending.
There’s no simple answer as it depends on your personal circumstances.
Remember, if you stop contributing to your pot, your employer will stop contributing too. Most people also get an extra 20% top-up from tax relief every time they contribute. Pausing your contributions means you won’t get this extra money.
You may find our help centre article useful as you explore your options.
We recognise that bills are rising. If you need to pause or reduce your contributions to focus on your day-to-day costs, that’s okay. Just set a personal reminder to start contributions when you’re ready. You may need to ask your employer to get these set up again.
In most cases, there’s a legal minimum amount that must be paid into your pot by yourself and your employer. That means you’ll only be able to reduce your payments if your employer currently pays more than the minimum level. You'll need to discuss this with your employer.
If you’re self employed or your employer isn’t required to contribute towards your pension, you can choose to pay as much or as little as you’re comfortable with.
If you’d like to get a clearer view of where every pound goes and how you can make the most of your finances, MoneyHelper’s budget planner might help.
If you’ve just been enrolled into Nest but aren’t sure you can afford to contribute, you can opt-out up to one month from your enrolment date. You’ll get a full refund of any payments that you’ve made. Opting out means you won’t receive any additional contributions from your employer or from the government through tax relief.
If you change your mind after you’ve opted out, you’ll need to ask your employer to enrol you into Nest again. It might be worth setting a personal reminder for a few months’ time to see whether you’re ready to start saving for the future.
Can you access your Nest pension savings?
There are rules and regulations around withdrawing your pension savings, because it’s meant to be a nest egg put aside for later life.
You can't legally withdraw your savings before age 55 unless you have serious ill health.
If a scheme offers to help you release cash from your pension before you’re 55, it’s almost certainly a scam. You can only withdraw your savings before then if you’re suffering from serious ill health or are incapable of work due to illness.
If you’ve got several different pension pots, transferring them together will make it easier for you to withdraw your savings when you’re allowed to.
You can withdraw your pension savings from the age of 55. Whether you choose to take all or some of it, 25% of your withdrawal will be tax free. You’ll find all the information you need in our help centre article on taking your money out.
If you’re still working, then it’s worth thinking about how you’ll fund your later life. The longer you can leave your savings untouched, the longer you’ll have to build up your pot. There are also tax implications to bear in mind.
Whatever you decide, we recommend you get advice or guidance from an independent expert. Pension Wise offers free appointments to talk through your options and help you make the right decision for your circumstances. They can also check that you’re not being scammed.
If you’ve built up several pensions over the years but lost track of your pots, the government offers free service to search for lost pensions.
Not everyone retires as soon as they reach State Pension age. Some choose to stop working earlier. Others keep working and continue to build up their pot. Whatever your plans, it’s your choice.
If you’d like to withdraw your Nest pension to live off, take a look at the different options available to you at retirement.
Remember, the longer you leave your money, the longer it has to grow. And the longer you leave until you claim your State Pension, the higher your payments could be. If you choose to keep working after age 66, you generally won’t have to pay National Insurance contributions, increasing your take home pay.
To see how much money you’re entitled to, check your State Pension forecast.
Organisations offering help and support
If you’re worried about how rising costs of living will impact you and your family, there are several organisations offering help and support.
Need more help?
It’s important not to panic or make rushed decisions about your pension. Our advice and guidance page explains where you can get help.
Benefits of our investment approach
Members like you are at the heart of our approach. Everything we do is designed with your needs in mind.