'Don't panic' is the message to those worried about pensions
Published 28/06/2016 | 02:30
Consumers have been warned of further falls in share prices and the value of sterling in the wake of the Brexit referendum.
But people with pensions, savings and investments have been advised by financial experts not to panic.
The financial turmoil that has resulted from last week's referendum vote in Britain has hit the value of private pension funds in the short term.
Some 700,000 people in the private sector have a collective €110bn invested in retirement funds.
However, Jerry Moriarty of the Irish Association of Pension Funds, which represents pension trustees, has emphasised that pensions must be seen as long-term investments.
He explained: "Unless you are coming close to retirement, you shouldn't over-worry about short-term losses."
Mr Moriarty said that for people coming close to retirement it was likely that their funds would be automatically moved to less volatile investments in order to avoid losses from which their fund may not have time to recover.
Rory Gillen, of the advisory firm Gillen Markets, said there would be a short-term hit for those with investments.
However, he cautioned: "But we're not convinced it will matter much to the global economy in the medium to long term."
Throughout stock market history, there have been many difficult times in economies, whether the cause was war, recession, inflation, technological change or other calamities, said Mr Gillen.
"And yet, developed, democratic economies and stock markets have continued their upward progress over time. We seriously doubt that Brexit ranks up there with any of the real calamities that have occurred over time."
The managing director of the savings bank Nationwide UK (Ireland), Brendan Synnott, said the direct impact of a Brexit on Nationwide would be limited, so in the short term nothing will change.
He added: "What also won't change is our commitment to ensure that our customers' money is as safe with us today and in the future as it has always been.
"Nationwide's commitments to the Irish market are unchanged by the result of the Brexit vote."
Meanwhile, the president of the Irish Brokers' Association, Aidan McLoughlin, said that comments in the UK and internationally suggested appropriate action was likely to be taken in order to allow markets to stabilise quickly.
Therefore, there was no need for panic just yet.
He said: "Those with a longer time perspective are likely to see greater volatility in their returns in the short term. The longer time perspective will allow the fund to wait out the current storm whilst the continuation of contributions will ensure the fund benefits from the recovery."