Many pension holders got a big shock when they opened their statements this month to find the value of their investments had dropped, in some cases, by 25 percent over the past six months.

The financial markets plummeted last year with investors losing money across the board and the early signs are that 2009 could get even worse.

But Lauren Bell, executive vice-president of life and pensions at the Argus Group, urged pension holders, especially those nearing retirement, to act now and review their plans and decide whether to stick with what they have got or switch funds.

Patrice Horner, vice-president of North Atlantic Asset Management, said it was important for investors to be in the right risk profile, despite the fluctuations in the markets, and to stay the course and know where they want to be.

She advised pension scheme members to sit down with their financial advisers or plan providers to analyse their situation and to work out how much they have invested, the rate of return on it and what percentage of annual income they will have available at retirement, via an online calculator on the BF&M website.

"You are going to have to look at the whole picture," she said. "The important thing is that younger people will not have invested as much as seniors, so the dollar amount may not be as much as if they had been saving for 30 years, for example, and because they have more time they can take out more risk and once they have built a nest egg they can preserve that.

"But I think generally most people understand that we have had the bust of the boom/bust cycle and it will take time to recover."

Ms Bell said that 2008 was one of the most difficult years for investors in recent times, impacting returns and all asset from equities to fixed incomes, apart from government bonds, which gained in value, while the S&P 500 Financials fell 56.95 percent between January and December last year.

She said that the Argus Select Funds, which were launched in 2005, had fared well compared to other local and overseas funds because they were diversified and conservative in their outlook, but recognised that some of the insurance company's pension plan members would have cause for concern having read their latest statements.

"We are aware that when our members got their statements, in some cases, it was quite a concern to see how much the value of their plan has declined over this period," she said.

"If retirement is many years away and you are comfortable with your risk profile, there is no need for you to make any adjustments.

"Markets go up and down on a regular basis, and although current market conditions are worse than they have been in quite some time, they will recover in time.

"If you are very uncomfortable, you should review your investment strategy to make sure that the fund or asset allocation you have selected is still a good fit for your risk tolerance.

"You should check with your pension provider to see if they have a suitable risk profile questionnaire."

Ms Bell said that if a person's appetite for risk had changed, they might want to become more conservative with their investment strategy or choice of investments, for example, moving from a growth to a balanced portfolio or reducing exposure to equities, lengthening the time it takes for their account value to recover.

But she added that it may be the right decision if the ongoing market volatility was a big worry for the individual, while changing from stocks or funds to a cash investment at the present time would lock in their losses.

"Ultimately the choice is up to the individual investor because no two investors are the same," she said.

"You could be a young investor, but you are not comfortable with risk or you may have someone who is approaching retirement and you would expect them to have a more conservative strategy, but that individual may be very comfortable with investments that can fluctuate and have more risk.

"Most pension providers should supply tools to help members understand the valuations of their investments and make an informed choice."

Ms Bell said if investors chose to shift their funds accordingly, it was best to do it gradually, while those people who would have their employment terminated in the near future, have the option of transferring their account value to an Argus Individual Retirement Plan, which allowed timed for the market to recover.

She stressed that even if the value of an investment declines, it is only a 'paper loss', with no money being lost unless it is sold at a lower price than what it was bought at, recommending a long-term approach to investing in light of markets experiencing a cycle of ups and downs on a regular basis and not to let short-term movements in fund values dictate a material change in strategy.

Furthermore, Ms Bell said that there was an opportunity to buy more units with regular contributions when fund prices were low, putting the pension holder in a better position when prices started to rise again, and advised not to try and time the markets and make rash decisions which may be regretted later.

"We recognise that right now it is a really difficult time for pension plan members and across the board with all pension providers and financial institutions having seen their accounts decline," she said.

"But the bottom line is that this is a market cycle and if they are able to hang in there for the long-term the market will recover, but if they are uncomfortable then they should reassess the risk and look to cut back gradually."

For more information, contact Argus on 298-0888, e-mail insurance@argus.bm or visit the website at www.argus.bm; or BF&M at 295-5566 or North Atlantic at 296-8288 with queries about investments or visit the website at www.bfm.bm or www.assetmanagement.bm