84% of Sampension customers switching investments opt for higher risk

Eighty-four per cent of Sampension customers that choose to change their investment profile opt for one that is higher risk, the provider has revealed.

The pension company has seen an increase in customers opting to change their investment profiles following the launch of automated investment guidance on its website. After two years of providing the service, the number of customers using it has increased by 125 per cent. As a result, the number of customers opting to change their investments has increased by 80 per cent in the first nine months of 2021.

And when customers change investment profile, the vast majority choose to switch to high risk (84 per cent), while 12 per cent have changed to moderate risk and 4 per cent to low risk.

Sampension marketing and customer advisory manager, Anne-Louise Lindkvist, said: “Risk appetite is individual and there is nothing that is right or wrong. Some want the most possible risk and thus higher expected returns in the long run, while others would rather have peace of mind and fewer fluctuations in returns along the way – although this may involve a risk of lower returns and lost purchasing power.

“No matter what, it is important to make sure that your pension is invested with the risk you prefer. Therefore, it is positive that more and more people are taking a stand on their investment risk.”

In addition, the provider revealed that more women are also now changing their investment profiles. In the past year, the number of changes among women has increased by 13 per cent, while in the same period there has been a decrease of 5 per cent among men.

“Historically, women have generally been less interested in retirement savings than men. But there now seems to be a landslide in progress, where more people relate to their pension savings, including their investment profile. And that's very positive. Not least because women generally have fewer savings than men and at the same time typically retire earlier and live longer,” Lindkvist said.

She advises that all pension savers should review their investment risk once a year. Calculations by Sampension show that a 40-year-old with a deposit of DKK 1m and annual payments of DKK 60,000, who changes their investment profile from low to high, can increase savings at the time of retirement by approx. DKK 600,000 from approx. DKK 3.4m to DKK 4m.

However, Sampension said this is an average estimation and if stock markets develop unfavourably over the years, it will impact higher risk investment profiles more.

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