UK - Pension funds have plunged in value by almost a fifth in real terms in the past 12 months - the largest fall in more than 20 years.
The performance figures – calculated by Watson Wyatt from CAPS data – also show that pension schemes have fallen in real terms relative to prices by 30.5% since their peak at the end of 1999. Pension schemes last saw their funds at this low level in 1996.
These statistics come just a week after the latest CAPS figures were published showing that scheme values had fallen a further 4.4% in the first three months of this year. This figure will be substantially higher when inflation is taken into account.
Russell/Mellon CAPS research and development director Alan Wilcock said: “It has been an extremely disappointing start to the year given the previous three years of negative investment returns.
“This will provide no comfort to trustees who are responsible for funding final salary benefits for their members or to members of defined contribution schemes who bear the investment risk themselves.”
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