How to protect your pension pot from market turmoil

The traditional way to protect your pension fund from market risk is to begin shifting your savings out of equities well ahead of retirement. But there are some problems with this approach, says David Prosser.

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In days gone by, when the vast majority of savers used their entire pension fund to buy an annuity income at the point of retirement, planning to mitigate the risk of a last-minute collapse in the value of the fund was routine. That’s not necessarily the case today because the assumption is that most people prefer to generate retirement income through an income-drawdown plan, where the pension fund remains invested.

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David Prosser
Business Columnist

David Prosser is a regular MoneyWeek columnist, writing on small business and entrepreneurship, as well as pensions and other forms of tax-efficient savings and investments. David has been a financial journalist for almost 30 years, specialising initially in personal finance, and then in broader business coverage. He has worked for national newspaper groups including The Financial Times, The Guardian and Observer, Express Newspapers and, most recently, The Independent, where he served for more than three years as business editor.