Investments as you approach retirement

Now that you’re on the home straight towards retirement, it’s a good opportunity to review how your retirement savings are invested, and make sure they fit with how you plan to take your money at retirement.

Generally speaking, you might want to start thinking about more moderate-risk investments if:

  • You’re now mid-way through your career, but thinking of retiring early.
  • You’re close to retirement but have some other pension benefits from previous jobs or a personal pension.
  • You have some other types of assets outside of your retirement savings (personal savings for example).
  • You’re planning to use the income drawdown option when you retire.

A low-risk investment strategy may be more suitable if:

  • You’re close to retirement and plan on buying an annuity when you retire.
  • You’re about 15 years away from your chosen retirement age, but you’re not entirely sure when you’ll actually retire.
  • You’re about 15 years away from retirement with no other significant pensions or assets that will provide an income when you retire.

The Lifestyle Option

If you’re invested in this option then your money will be moved automatically into lower risk investments as you approach retirement. You do need to bear in mind though that it has been specifically designed to suit people who will withdraw their retirement savings gradually throughout their retirement rather than buying a guaranteed income (annuity).

Closed Lifestyle Option

If, on 30 September 2013, you were invested in the Lifestyle Option and within 10 years of your Selected Retirement Age, you will be in the Closed Lifestyle Option which is different from the one described above.

This one is designed for people who will be choosing an annuity at retirement – or a regular income throughout their retirement. That means that as you get nearer to retirement your money is invested in corporate bonds and gilts as the market value of these is broadly linked to the cost of buying a guaranteed income (annuity). So you need to think about whether this is how you’d like to take your money when you do retire.

What else should I think about?

Your plans may have changed in the last few years, so it’s always good to review your planned retirement age, to see if it still fits in with what you intend to do. This goes hand in hand with thinking about how you’ll take your money when you retire.


Have a look at the 'Shaping your retirement' page for more information about how you can take your money.


You may also want to think about Choosing when to access your savings, and How long will your savings last?.