Your lifestyle fund is ‘pre-programmed’ to deliver a particular outcome (stay invested, choose a drawdown, purchase an annuity, take as cash) on a specific date.

You need to know because:

  • The fund may be targeting an annuity, for example, when you’d prefer to stay invested or take cash, and
  • It’s designed to deliver that outcome on a fixed retirement date, which may have been chosen by your employer and it may no longer suit you.

This could mean that your pension savings are not invested in the right way to deliver the outcome you want and/or when you want it. 

For instance, if you want to retire earlier than planned*, you may find you’re invested in a mix of investments that is too risky, which could mean your savings fall in value just before you retire, affecting your pension benefits. If you want to retire later, you may have the opposite problem, having moved into lower risk investments which may not provide the growth you need to sustain you in retirement, particularly when inflation is high.

It’s important to find out if you’re in a lifestyle fund and if you’re in any doubt, phone us on 0345 610 0010 (call charges will vary). We can explain your options to you but we can’t give you advice.

* The earliest you can access your pension under current legislation is age 55 (increasing to age 57 on 6 April 2028).

Please remember that the value of an investment can fall as well as rise and isn't guaranteed.

The value of your pension pot when you come to take benefits may be less than has been paid in.

Your choice of investment fund can have a big effect on your pension benefits. If you're in any doubt about which fund's right for you, you should speak to a professional financial adviser. MoneyHelper gives free and impartial guidance to help make your money and pension choices clearer. If you don't have a financial adviser, you can visit MoneyHelper to find the right one for you.