Economic uncertainty has been a persistent theme in recent months, but happily, not every area has been negatively impacted. Indeed, our latest figures show that the pension sector has bucked the trend and posted unexpectedly strong returns during the third quarter of the year, a welcome development for those seeking to build their pots.
The data, taken from the latest Moneyfacts Personal Pension and Annuity Trends Treasury Report, which is due to be released later this month, shows that Q3 2016 proved to be a very productive period for pension fund performance, despite economic uncertainty. The average pension fund posted a growth of 6.8% between July and September, leaving it up by 13.3% over the calendar year to date. The table below highlights the growth seen over the last year, and as you can see, things are looking good!
"Given the prevailing global economic uncertainty, many pension savers may have expected the performance of their pension funds to have suffered, but this has not been the case," said Richard Eagling, head of Pensions at Moneyfacts
"The last quarter generated strong returns for most pension funds, and if they can avoid heavy losses during the remainder of the year, then 2016 will be the fifth consecutive year of positive pension fund returns. It will also be the fifth time in the last eight years that the average pension fund has delivered double-digit growth."
He adds that, "with a greater number of individuals now making their own retirement provision through defined contribution pension schemes, the performance of pension funds has never been more critical" – so this latest boost in performance will come as welcome news!
Securing strong growth on your pension savings is key to building up a healthy pension pot, so it makes sense to stay on the ball. Most people who have been automatically enrolled will be in a default pension scheme, but it's important to review the performance of your savings on a regular basis; if you think you could be securing better returns, speak to a financial adviser about alternative funds you may want to invest in, and you may be able to benefit from even greater growth which can lead to a healthy income in retirement.
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