Pension Funds

How does NEST manage my money? What Pension Funds do they use?

Understanding how pension schemes look after your money can seem confusing, but at NEST, they try and keep things simple. They have one goal – to give then a better income in retirement. For them it’s important to explain exactly what they do, so that you can confidently make decisions about saving for your future.

NEST explains…

What happens to your money?

To prepare your money for when you’re ready to retire, we name each fund so that it corresponds with the year you’ll take your money out. NEST 2025 Retirement Fund is for members who have chosen to retire and take their money out in 2025). Retirement date funds are originally set to the later of age 65 or your State Pension age. However you can change this to any age from age 55 onwards, whatever best suits you. Typically a portion of the money in your fund is kept as cash. The rest is used to buy shares in companies or property, and make loans to governments and big companies.

We don’t put all your money in one place!

That way it’s safer and more likely that your investments will increase over time. Some investments will grow less than others but are more certain. Others are less predictable but give you the chance to grow your money more. So our experts look at lots of different areas to make sure your money is spread across a range of investments. By doing this, we give your money the best chance of growing steadily and faster than the rising cost of living. This is generally the most suitable fund for most members.

However, depending on your religious beliefs, moral choices or appetite to risk, you are able to transfer to another NEST fund (such as NEST Sharia Fund, NEST Ethical Fund, NEST Lower Growth Fund or NEST Higher Risk Fund).

Thinking about taking out your money

To make sure we invest your money in the right way it’s important that we know when you expect to take your money out. We call this your NEST retirement date. When you join, your NEST retirement date is set as the year you are expected to start collecting your State Pension or age 65 of later. Your retirement pot will be invested in the NEST Retirement Date Fund that corresponds to your NEST retirement age. If you’re looking to retire in the next 15 years, you’ll need to think about whether or not you still want to take your money out on your current NEST retirement date. You can change your NEST retirement date at any time by logging in to your online account and choosing ‘Edit your profile’.

Other fund choices

We believe that NEST Retirement Date Funds, which are designed to prepare your money for when you’re ready to retire, are likely to be the best choice for most members. However, there are other fund options that you may decide are more suited to your preferences. They are:

NEST Ethical Fund
NEST Higher Risk Fund
NEST Lower Growth Fund
NEST Sharia Fund
NEST Pre-retirement Fund.

Find out more about NEST’s other fund choices.

Please note all information on this page is provided by Nest, and is accurate at the time of publication, for further information, please do contact Nest direct.