British pensioners are poised to benefit from Donald Trump’s election victory, as the former US president’s pro-business stance boosts stock markets, particularly in the United States.
Andrew Evans, group chief executive of Smart Pension, the UK’s leading pensions business, highlighted the positive impact of rising US markets on UK pensions by investing in US assets.
Evans said, “US markets have improved dramatically since Trump’s victory, benefiting UK pension savers with funds tied up in US assets, whether they realize it or not.”
Smart Pension, which manages the retirement savings of 1.4 million people, has 52% of its capital invested in the US. After Trump’s election, the S&P 500 fell 5% to a record high of 6,001.35 points. Although it fell slightly to 5,863.69 points, the index remains 2.6% higher than its pre-election level and is up 12.8% since August. Similarly, the Nasdaq Composite Index reached record highs and was up 2.6% compared to November 4.
Despite concerns over Trump’s trade policies, which some economists warn could derail global markets and fuel inflation, investors remain optimistic about his promises of corporate tax cuts and an agenda to boost growth. Evans noted, “Trump’s policies that promote American growth and corporate wealth will benefit pension funds around the world.”
Rachel Reeves calls for pension reform in the UK
Meanwhile, in the UK, Chancellor Rachel Reeves has proposed a significant overhaul of workplace pensions, aimed at consolidating smaller pots of “megafunds” worth £80 billion. These large funds are expected to have the ability to invest in multiple assets, driving growth and returns for savers.
Evans welcomed the plan, which aligns with Smart Pension’s mission to transform retirement savings. The company currently allocates 6% of its capital fund to private markets and plans to increase this investment.
However, Evans called for more government stimulus to encourage domestic growth, especially given the Chancellor’s £41.5 billion tax increase outlined in the Budget. “Promoting growth while raising taxes significantly is the remaining challenge. More structural measures are needed to support investment in the UK,” he said.
