What happens to the money in your pension pot?

The money in your pension pot is invested to give it chance to grow. It’s invested in a number of things, including shares in companies, property, and loans to companies. The money in your pension pot is invested by a company called Scottish Widows. They’re a UK-based company appointed by the Trustees to help manage the Plan’s investments.

Nobody’s expecting you to be an investment expert. So if you don’t want to choose your own investments, there’s an investment strategy that everybody’s money uses. It’s called the Default Lifecycle option. This is the option that the Trustees think is likely to be appropriate for most members.

When you first join the Plan, your money is invested using the Default Lifecycle option

This option uses an investment strategy which moves your money to lower risk funds as you get close to reaching your Selected Retirement Age. The Default Lifecycle option aims to do two things:

  1. Give your money a good chance of growing until you’re 10 years from your Selected Retirement Age
  2. Protect the value of your money in the 10 years before your Selected Retirement Age

Your Selected Retirement Age is usually age 65, but you can change it if you want to. You can also choose a different Lifecycle option.

Find out more about the Lifecycle option

If you want to, you can choose your own investments with the Do It Yourself option

With this option, you choose the funds you want to invest your money in. There are currently 12 funds to choose from. Each one has a different investment profile, which means they have different levels of investment risk and potential returns. It’s important to think about the right balance of risk and return for you, so you feel comfortable with the funds that you’re investing in.

If you choose the Do It Yourself option, you’ll need to keep an eye on your investments. Over time, your attitude to risk and investing might change, so you might want to move your money to different funds.

Find out more about the Do It Yourself option

You can find out more about how your money is invested on the Scottish Widows website

The investment guide should answer most of your questions. You can also log in to their website at any time to see how your money is invested, how your investments are doing, and change the funds you’re investing in.

If you’re not sure which investments are right for you, you might want to talk to a financial adviser

They’ll charge you for their time, but a lot of people find them worth it. To find a financial adviser near you, these websites are a good place to start.

www.unbiased.co.uk www.vouchedfor.co.uk

Your money makes a difference in the world while it’s invested

Here’s a short video to show you where your money goes between you putting it into your pension pot, and taking it out.

Read the video transcript

If you’re saving for your retirement, have you ever wondered what happens to your money between the moment it leaves your pay packet and the moment you start taking it back as your pension?  

Where does it go?  

Into a Swiss bank account?  

On the 4.50 at Chepstow?  

To the Maldives?  

No. But it does keep itself busy.  

It tries to grow by buying buys bits of companies.  

Often companies you’ve heard of, who make things you like.  

Like tea bags.  


Or TV shows about talented dogs.  

But that’s not all!  

Your money goes into buildings too.  

Like this low energy housing in Manchester …  

And this shopping and leisure centre in Bracknell.  

It put broadband into homes and businesses in Cumbria.  

It backs wind turbines and solar farms, flood defences and hospitals.   

It’s building a new train line right through London.  

It even helps the government educate our children …  

… and keep us safe.  

None of this would exist without help from millions of savers like you, and billions of pounds of your money.  

So if anyone ever asks you ‘what good does a pension do?’, tell them this.  

Pension money’s the hardest working money there is.

When you're done with your visit to the website today, I'd love to ask you a few questions about your experience! Select me when you're finished if you'd like to participate.