What does ‘projected pension pot at retirement’ mean and why is my projected pension pot value lower than previous values I’ve been given?

Pensions are long-term savings and your projected pension pot at retirement depends on factors such as annual contribution increases, inflation and how and when you access your pension pot.

When we provide a projected pension pot value (either via your Online Account or in your annual statement) to illustrate what you might receive when you access your pension, we must make a number of assumptions on the factors above.

  • One of the key assumptions is how your investment funds might perform in the future as well as taking into account limits set out by our regulators. This is known as the ‘growth rate’.
  • Each year, The Trustee of The People’s Pension decide on the assumed growth rate for each fund based on advice from their professional investment adviser. This year, based on this advice – which reflected several economic assumptions – the Trustee decided to reduce the growth rates on each of our funds by 1% compared with last year. This means that your projected pension pot may be lower this year, compared to previous years, on a like-for-like basis.
  • It’s important to be aware:
    • these are just estimates of what might happen
    • the actual growth achieved by the funds may be higher or lower
    • any projection given is for guidance and is not guaranteed
    • we haven’t made any changes to the way we manage your investments.

If you’d like a more detailed projection, which provides full details of the assumptions used, or a projection on a different basis, please contact us.

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