Turning Your Pension into Gold: Why gold is making a comeback in retirement planning
As the global geopolitical landscape continues to shift and trade tensions rise, many investors are exploring alternatives to traditional workplace pensions to help protect and grow their retirement savings. One increasingly popular choice is gold.
Gold is widely recognised as the ultimate store of value and a reliable safe-haven asset during times of uncertainty. With a long-standing track record, gold offers powerful diversification benefits and serves as a strategic component for investors aiming to build a resilient and balanced portfolio.
Interestingly, the strong historical performance and continuing bullish outlook for gold is less well known.
Over the last 20 years, in £GBP, gold has returned over 919%, comfortably outperforming the FTSE 100 Index and MSCI World Index, as well as the S&P 500. Over the same period, these indices gained 249%, 562% and 903% respectively.
More recently, over the last year to June 2025, gold delivered a return of 31.8%, outperforming the FTSE 100 Index (13.2%), MSCI World Index (12.2%) and S&P 500 (12.8%) over the same timeframes.
Currently, the key demand drivers are a combination of global instability, currency devaluation, Central Bank buying, and increasing investor appetite for alternative assets.
In particular, and as the chart below from the World Gold Council illustrates, Central Banks turned from net sellers to net buyers of gold in 2010, marking a major policy shift. This has continued for 15 consecutive years, and from 2018 onwards gold buying surged due to rising geopolitical risk and de-dollarisation with Central Banks adding over 650 tonnes in 2018, the highest in 50 years at that point.
More recently, central banks have stepped up their gold buying to unprecedented levels - purchasing a record 1,082 tonnes in 2022, 1,037 tonnes in 2023, and 1,045 tonnes in 2024 (marking the third consecutive year above 1,000 tonnes per annum – far exceeding the prior decade average of ~473 tonnes per annum). This strong buying has continued into 2025, with net purchases reaching 244 tonnes in Q1 alone.
The Enduring Case for Gold in a Shifting Global and Domestic Landscape
Gold’s non-political, sanction-resistant nature and absence of counterparty risk remain key attractions for central banks. Amid ongoing de-dollarisation, growing interest in currency diversification, inflation hedging, and the pursuit of long-term monetary stability, many central banks now view gold as more appealing than traditional government bonds. Geopolitical risks remain elevated, and the changes underway are far from temporary—a new world order is taking shape, bringing with it profound uncertainties.
Meanwhile, the UK pension landscape is undergoing a significant transformation. The current Labour Government’s Pension Schemes Bill 2024–2025, introduced as part of its “workplace pensions roadmap,” aims to direct more pension capital into UK assets and consolidate schemes into £25bn ‘megafunds’. Simultaneously, Defined Contribution (DC) pension providers across the industry are moving to allocate approximately 5% of assets into UK private markets. In this evolving environment, many savers are seeking to maintain greater control, flexibility, and resilience within their retirement portfolios.
Against this backdrop, gold continues to shine—not only as a long-term store of value, but also as a powerful tool for pension diversification. Through SIPP (Self-Invested Personal Pension) and SSAS (Small Self-Administered Scheme) accounts, pension holders can gain exposure to physical gold that is fully allocated, segregated, and insured, with holdings clearly identified within the name of the pension scheme. This allows individuals to benefit from the security and transparency of physical ownership, combined with the tax advantages and flexibility of a private pension structure.
Have you considered gold investment as a pension strategy? Find out more about Sharps Pixley’s Gold Pension Planning, or get in touch on +44 (0)20 7871 0532 or [email protected] to speak to one of our experts.
04 Dec 2025 | Categories: Gold, Investment strategies, UK Gov, Pensions