Over the last few months, the UK has seen a significant increase in the cost of living, with UK inflation at its highest rate for 40 years.

We have also continued to see investment market uncertainty as a result of global events such as the war in the Ukraine. We know some members may be concerned about the impact on their pension savings, however, even when investment markets are volatile, the HSBC Bank (UK) Pension Scheme (the Scheme) remains a good way to save for your long-term future.

If you are paying into your Defined Contribution (DC) pension pot in the Scheme, you may also be benefitting from the Bank’s matching contributions as well as generous tax allowances from the government. It’s also important to remember that your DC pension pot is being invested for the long term. Whilst markets can go up and down in the short term, the aim for all three of the Scheme’s targeted investment strategies is for your DC pension pot to grow over the long term, to keep pace with long term inflation. Although, of course, this is not guaranteed.

If you have Defined Benefits (DB) in the Scheme, these provide a guaranteed income for life when you retire. Your DB benefits are increased over the period to your retirement and whilst they are in payment, to help protect against inflation.

Actions you can take today

You may still be wondering if there is anything you could be doing to help manage your pension savings. There are some important things you can check today:

If you are a member with a DC pension pot (including hybrid members and DB members with AVCs) and;

• if you are invested in one of the Schemes three targeted investment strategies, make sure that your Target Retirement Age (TRA) is correct on My Pension.  If you have not chosen a TRA, we will assume that you plan to access your DC pension pot at age 65.

   

  Your TRA is important, it’s how we know how to change the mix of investments for your DC pension pot over time. If you take your DC pension pot before your TRA, you will be taking it before the automatic investment switching is complete. This means that more of your DC pension pot will be invested to achieve growth than was planned. This increases the risk that the value of your DC pension pot may fall sharply up until the date that you access it. If you take your DC pension pot after your TRA, this increases the risk that your DC pension pot may miss out on some potential growth.

• if you are invested in the freechoice range of investment funds, it’s worth checking that your DC pension pot is doing what you want it to, for example, that you’re maximising its growth where you can, and the risk is right for you. If you’re at the start of your savings journey, you might have more appetite for risk, which has a higher growth potential for your DC pension pot. If you're close to retirement, you might want to take less risk, to lower the chances of any sudden falls in value as you get ready to take your DC pension pot.

If you are approaching retirement or thinking of making investment changes, you should consider taking financial advice from a regulated financial adviser. If you need help to find a financial adviser you can visit Money Helper.