The Investment Challenges of Decumulation
|
|
- Piers Williams
- 7 years ago
- Views:
Transcription
1 The Investment Challenges of Decumulation Part 3 June 2015 This document is for investment professionals only and should not be distributed to or relied upon by retail clients.
2 Investing in a DC world the importance of managing volatility during accumulation The UK pension reforms implemented from April 2015 provide UK pension savers with significantly greater freedom in determining how to use their accumulated assets. Unsurprisingly, the announcement has prompted a great deal of research into appropriate investment strategies for decumulation the gradual use of accumulated assets to fund retirement income. However, changing the way in which pension assets can be accessed also has profound implications for how to best accumulate these assets in the first place. The purpose of this paper is to investigate the accumulation stage of the defined contribution (DC) journey and, in particular, to show that accumulation and decumulation need to be considered as two interlinked parts of the same process. The investment challenges of DC: summary of our findings to date In previous papers, we used historic investment data and stochastic analysis to demonstrate: a decumulation strategy will require taking investment risk investment volatility is a major determinant of outcomes for DC scheme members payment systems (such as withdrawal caps and variable income) are key tools in delivering good outcomes for members living off their retirement savings equity-level returns with lower volatility, as delivered by a multi-asset growth approach, are very attractive in a decumulation world, adding significant value relative to a passive equity approach even after fees simple approaches to highlight the sustainability of drawdown levels for different types of investment. 2 Investment Insight: DC Solutions
3 The investment challenges of DC part 3 While our earlier analyses focused on the investment issues for an individual looking to live off pension savings in retirement, in this paper we take a more holistic view of the overall lifetime investment challenge from the perspective of the plan sponsor and/or DC trustees. As such, we take the opportunity to look at the investment challenges of accumulation strategies given the new freedoms for UK savers post-retirement. Chart 1: The evolution of the DC journey The old lifestyle model specified retirement date Savings and Growth accumulation Preservation of annuity purchasing power Drawdown plus Annuity Pre-retirement Post-retirement The Whole of Life model a phased approach based on needs & requirements Savings and Growth accumulation Decumulation (Income and Growth) Annuity We advocate that DC scheme designers should now be mindful of a whole-of-life approach. This is more appropriate for an individual DC saver than the old lifestyle model that presumed annuity purchase. With annuitisation, it was expected that investment risk would cease at the retirement date, in which case, de-risking in the run-up to retirement was appropriate. In the whole-of-life model, the pivot-point of retirement is far less important. As we have demonstrated previously, decumulation retirees will need exposure to investment risk after retirement in order to generate sustainable income. As a result, the distinction between pre- and post-retirement investment strategy is no longer clear-cut. This means the accumulation strategy of the old lifestyle model is unlikely to be appropriate for a saver choosing decumulation. Someone s sitting in the shade today because someone planted a tree a long time ago. Warren Buffett Investment Insight: DC Solutions 3
4 The decumulation challenge is also an accumulation problem Chart 2: Example of a traditional asset allocation model for Defined Contribution plans over time Portfolio Allocation 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% Portfolio Expected Risk Premium (right axis) Equity Traditional Lifestyle Approach 6% Cash Bonds 0% % 1 Years To Retirement / Horizon 5% 4% 3% 2% 1% Expected Return over risk free (cash) Chart 2 illustrates the traditional DC investment glidepath approach. The conventional asset allocation approach reduces exposure to growth assets around five to 15 years prior to the scheduled retirement date. Assuming that the saver takes the full allowance of tax-free cash at retirement, the investment strategy leads to an undiversified bond portfolio. This de-risking process results in a substantial reduction in the return potential of the portfolio, just when the pension pot size should be approaching its maximum size. Critically, we question the suitability of an undiversified bond portfolio as an appropriate starting point for a DC member choosing to invest and live off pension savings in retirement. Surely, if the landing site for drawdown investors is different, their glidepath during accumulation should also be different. In this sense, the choice of decumulation strategy has a crucial influence over the accumulation strategy. Choosing the right landing site is vitally important, as it can help mitigate the substantial dangers of markettiming risk. The importance of joining up the accumulation and decumulation approaches We revisit an earlier study, where we illustrated the significant differences between retirement outcomes for three investors whose retirement date differed by only one year. We assume their pension fund at retirement is invested 100% in global equities, with 6% of the retirement sum drawn down as annual income and payments inflation-protected over time. We graph the passage of the remaining fund over time, as payments and investment returns take effect (Chart 3). As Chart 3 demonstrates, the outcome for the saver retiring in 1982 is decidedly better than that experienced by the 1984 retiree, whose pension fund runs out after 25 years. Why this difference? Looking at historical equity market performance data, it is clear that the 1982 member benefited from very strong equity returns in the first two years of drawdown. The 1984 retiree missed out on this good fortune. Chart 3: Sustainability of drawdown payments Fund value 4 Investment Insight: DC Solutions 500, , , , , , , , ,000 50, Number of years of payment
5 However, the 1984 retiree would only miss out on this windfall if the investment strategy had de-risked, as the old lifestyle model recommends. Had investment risk been maintained through late stage accumulation and into retirement, then a different outcome would have been achieved.to show this, Chart 4 considers the outcomes for these retirees using a whole-of-life approach. The investment strategy again, global equities remains constant through both working life and retirement. Chart 4: Fund values over 30 years accumulation and 30 years decumulation 1, 800,000 Fund value throughout accumulation and decumulation 1, 600,000 1, 400,000 1, 200,000 1, 000, , , , , years of accumulation followed by 30 years of decumulation We have assumed that our DC savers invest 20% of their pay each year, with pay increasing by inflation. After 30 years, they start taking a pension income of 50% of their salary at that time. Thereafter, the pension payments increase in line with inflation. This can be thought of as similar to a defined benefit pension plan that accumulates a pension using an accrual rate of 1/60 per year (i.e. 30/60th of pension is accumulated at retirement). The chart demonstrates that the variability of payment longevity is now much reduced; all three pensions last in excess of 30 years. Why is this? Chart 3 showed that the 1984 decumulation retiree (equivalent to the 1954 saver in Chart 4) ran out of money on account of missing the strong returns of 1982 and That problem has now been mitigated. By maintaining a constant investment strategy, the 1984 retiree now enjoys the benefit of these returns in latestage accumulation. As a result, the starting-pot size for a member retiring in 1984 is bigger than that of a 1982 retiree. This reduces the negative impact of weaker returns in early retirement. Avoiding reinvestment/market-timing risk helps to decrease the variation in outcome for DC members; clearly, having a joined-up approach to accumulation and decumulation is of huge significance in determining retirement outcomes. This should be taken into account when planning an accumulation strategy. Moreover, our findings suggest that the decision to decumulate ought to be taken many years prior to retirement. So, what is an appropriate investment strategy for both accumulation and decumulation? In previous papers, we demonstrated conclusively the role of a reduced-volatility, multi-asset growth strategy in decumulation. How might that work during accumulation? Growth assets lower cost versus reduced volatility In Charts 3 and 4, we used equities as a proxy for growth assets. However, as history has amply demonstrated, equity markets are subject to sharp corrections from time to time. Therefore, it is intuitively appealing to reduce the volatility of the pension pot closer to the end of the accumulation phase, albeit not at the expense of losing investment returns. Many DC saving plans use equity-only investments (usually passive plans because of their low costs) in the early stages of accumulation and then switch to a lower-risk profile. In some cases, this involves a higher-fee multiasset growth strategy. Investment Insight: DC Solutions 5
6 Much has been written and argued on the benefits of active equity management (and higher fees) compared with passive equity investment. However, there has been less of a focus on the advantages offered by a multi-asset growth strategy in seeking to deliver the same level of return as a passive equity approach but with markedly lower volatility. To investigate this, we carried out a stochastic analysis to answer the question, At what phase of the accumulation cycle is it more beneficial to invest in a higher-cost, actively managed multi-asset growth strategy versus a lower-cost (and higher volatility) passive equity strategy?. We considered accumulation periods up to 40 years in length and carried out 10,000 projections. Our assumption was that the multi-asset growth strategy could deliver similar returns (gross of fees) to passive equity, but with a higher annual charge of 0.5%, versus 0.1% for passive equity. Crucially, we assumed multi-asset growth could deliver its return with just two-thirds of the volatility associated with equity investment (Chart 5). Chart 5: Stochastic analysis of Multi-Asset Growth outcomes versus passive equity over time % probability of Multi-Asset Growth exceeding passive equity growth over time Multi-Asset Growth versus Passive equity Time horizon of accumulation (years) Chart 5 indicates the probability of multiasset growth outperforming passive equity over time. The same contribution history (with contributions increasing by inflation every year) is used in all examples. We can see that, in the early years, there is little to choose between multi-asset growth and passive equity. In other words, there is as much chance of relative outperformance as relative underperformance. However, as we extend the time horizon to encompass periods of strong and weak market growth, it is clear that the lower-volatility multi-asset growth portfolio can deliver a better outcome than passive equities. individual investor outcomes may vary greatly owing to market-timing risk. By contrast, the multi-asset growth approach delivers good investment outcomes more consistently. Plan sponsors, who need to consider an investment strategy that can provide good investment outcomes more reliably for different generations of DC savers, may consider that the value of consistency as offered by multi-asset growth is of greater benefit than a lower-cost passive approach which is more likely to deliver a much wider spread of outcomes, both better and worse. While the highest investment sums may be accumulated under a passive equity approach, this will depend on market conditions, and 6 Investment Insight: DC Solutions
7 Lifestyling comparison between the old model and using multi-asset growth It is also worthwhile looking at a multi-asset growth approach for accumulation and comparing that with the traditional lifestyle outcome. Chart 6 shows the range of portfolio outcomes for our projections analysis, for DC savings accumulated over a 35-year period. The traditional lifestyling model assumes de-risking into bonds over the final 10 years and providing tax-free cash at retirement. The multi-asset growth approach assumes some derisking is done over the final 10 years into cash in order to fund a 25% tax-free cash sum. Our findings show that the median multi-asset growth portfolio is 11% bigger with reduced probability of a bad outcome. At the 10th and 25th percentiles, the multi-asset growth portfolio is 12% bigger and delivers greater commonality of accumulation outcomes. Both of these projections allowed for the provision of tax-free cash. This may be ideal for many savers who want to spend their tax-free cash (on holidays, cars, etc.) on retirement. However, for those who want to invest these monies (since their DC pot is their main source of retirement income), the issue of markettiming risk will again come to the fore. As discussed earlier, the decision on whether a saver does or does not want to take tax-free cash at retirement should be made before any de-risking adjustment is undertaken. Chart 6: Distribution of portfolio value outcomes for a regular saver over a 35-year period Accumulated fund after 35 years of saving 1,880,000 1,680,000 1,480,000 1,280,000 1,080, , , , ,000 80, Multi-Asset Growth Lifestyle Count of projections Assumes 10% pension contribution from a 30,000 salary, escalating at 3.50% p.a. Returns take account of 0.5% fees for multi-asset growth and 0.1% for lifestyle. Conclusions, discussion and future work Decumulation raises important issues for existing DC default investment glidepath approaches. Regarding the question of whether or not to live off pension savings in retirement, it is important that savers make this decision before any de-risking within a glidepath approach is undertaken, in order to mitigate market-timing risk. It is imperative to control investment risk. A lower-volatility growth asset approach (such as multi-asset growth) would be very attractive through the entire accumulation cycle, compared with the lower-fee benefit and higher-risk drawback of a passive equity approach. It is essential to reduce the existing variability in retirement outcomes. Thus, the core issue in DC investment design is managing investment volatility effectively, rather than focusing solely on lower fees. We now ask if there is still room for annuities in the drawdown phase, as implied earlier in our whole-of-life model (Chart 1). In the next phase of our work, we aim to assess at what point in the drawdown cycle it might become more compelling to buy an annuity. Closely linked to this is analysis to help savers establish the likelihood they will outlive their savings at different drawdown levels of income. We shall seek to explore these topics in future papers. Investment Insight: DC Solutions 7
8 This material is for informational purposes only. This should not be relied upon as a forecast, research or investment advice. It does not constitute an offer, or solicitation of an offer, to sell or buy any securities or an endorsement with respect to any investment vehicle. The opinions expressed are those of Standard Life Investments and are subject to change at any time due to changes in market or economic conditions. Standard Life Investments Limited is registered in Scotland (SC123321) at 1 George Street, Edinburgh EH2 2LL. Standard Life Investments Limited is authorised and regulated by the Financial Conduct Authority. Calls may be monitored and/or recorded to protect both you and us and help with our training Standard Life, images reproduced under licence INVBGEN_15_1367_Investment_Insight_DC_Solutions_Part_Three_TCM 0515
The Investment Challenges of Decumulation
The Investment Challenges of Decumulation Part 2 March 2016 This communication is for investment professionals only and should not be distributed to or relied upon by retail clients. The Investment Challenges
More informationFor professional investors and advisors only. Not suitable for retail clients. Schroder Life Flexible Retirement Fund
May 2016 For professional investors and advisors only. Not suitable for retail clients. Schroder Life Flexible Retirement Fund Improving the DC journey Members in a defined contribution (DC) pension scheme
More informationFOR PROFESSIONAL CLIENTS ONLY BETTER DESIGN BETTER OUTCOMES LIFEPATH TARGET DATE FUNDS. Retirement
FOR PROFESSIONAL CLIENTS ONLY BETTER DESIGN BETTER OUTCOMES LIFEPATH DATE FUNDS Retirement Retirement is changing: markets are volatile and people are living longer. More than ever, pension scheme members
More informationWHOLE OF LIFE SUPERANNUATION
WHOLE OF LIFE SUPERANNUATION Challenging the status quo NOVEMBER 2012 INTRODUCTION There is no question that Australia is one of the most mature Defined Contribution markets in the world. But while Australia
More informationA new toolbox for retirement planning
Insights A new toolbox for retirement planning Part 1: Risk measurement: an essential tool for retirement income planning This is an updated version of a report first presented at Barrie & Hibbert s Retirement
More informationHow to achieve quality retirement outcomes for your members
How to achieve quality retirement outcomes for your members Speakers Andrew Pennie, Marketing Director, Intelligent Pensions Steve Patterson, Managing Director, Intelligent Pensions Chair John Moret, Chairman,
More informationOnline Investments. Our Fund Range and Investments
Online Investments Our Fund Range and Investments Why is it important to read this document? This document explains the funds available for you to invest in through our Investment ISA, which is a Stocks
More informationGuaranteed Drawdown. Giving you confidence about your retirement income
Guaranteed Drawdown Giving you confidence about your retirement income 1 The new retirement landscape As you approach retirement, it s time to make those important financial decisions that will see you
More informationPlanning a prosperous retirement
Planning a prosperous retirement Towry s Guide to Retirement Planning About Towry We are one of the UK s leading Wealth Advisers and specialise in providing high quality, expert financial advice to private
More informationInvestment Association response to the FCA s Retirement income market study: Interim Report
Investment Association response to the FCA s Retirement income market study: Interim Report 30 th January 2015 General comments 1. The Investment Association 1 is a long-standing supporter of greater flexibility
More informationPENSION INVESTMENT APPROACHES GUIDE. More detailed information
PENSION INVESTMENT APPROACHES GUIDE More detailed information OUR COMMITMENT TO YOU We want to do everything we can to help you achieve what you need from your plan. Aiming for investment growth is vital,
More informationYour guide to UK pension transfers
Your guide to UK pension transfers If you ve worked in the UK at some stage of your career you ve possibly built up a fund in a UK pension. Now that you re back living in Ireland you may wish to bring
More informationDB Personal Pension Plan
Deutsche Bank Human Resources DB Personal Pension Plan Handbook for employees of DB Group Services (UK) Limited DB Personal Pension Plan Contents Introduction 4 What is the Group Personal Pension Flex?
More informationInsights. Investment strategy design for defined contribution pension plans. An Asset-Liability Risk Management Challenge
Insights Investment strategy design for defined contribution pension plans Philip Mowbray Philip.Mowbray@barrhibb.com The widespread growth of Defined Contribution (DC) plans as the core retirement savings
More informationLet s talk pension flexibility The current position
Let s talk pension flexibility The current position 1 Let s talk pension flexibility the current position Change is coming. Budget 2014 heralded a shake-up of the pension system that will change how we
More informationYour Investment Options This guide sets out the investment options available on Synergy pension, savings and investment products
Your Investment Options This guide sets out the investment options available on Synergy pension, savings and investment products Contents 04 Why choose Standard Life? 06 Funds 09 Self-directed options
More informationObligation-based Asset Allocation for Public Pension Plans
Obligation-based Asset Allocation for Public Pension Plans Market Commentary July 2015 PUBLIC PENSION PLANS HAVE a single objective to provide income for a secure retirement for their members. Once the
More informationWelplan Pensions. Flexibility for members from 6 April 2016. Spotlight on flexibility:
Welplan Pensions Flexibility for members from 6 April 2016 Spotlight on flexibility: Pension freedom is great news for members Changes in the law mean that from 6 April 2015 many members of pension schemes
More informationPassive Plus III Universal Strategic Lifestyle Profile
Passive Plus III Universal Strategic Lifestyle Profile The Passive Plus III Universal Strategic Lifestyle Profile (SLP) has been chosen as the low-involvement option for your pension plan. It s considered
More informationBasic Guide to Retirement Income Options
Basic Guide to Retirement Income Options Can I afford to retire? Which retirement income solution is best for me? Should I take all my tax-free cash entitlement? Will my family benefit from my pension
More informationA GUIDE TO FINANCIAL GUIDE. New Pensions Freedom GIVING PEOPLE MORE CONFIDENCE TO SAVE INTO A PENSION
FINANCIAL GUIDE A GUIDE TO New Pensions Freedom GIVING PEOPLE MORE CONFIDENCE TO SAVE INTO A PENSION WELCOME Giving people more confidence to save into a pension Welcome to our Guide to New Pensions Freedom.
More informationGW Contracted-out Money Purchase Scheme ( the Scheme ) Statement of Investment Principles
GW Contracted-out Money Purchase Scheme ( the Scheme ) Statement of Principles This Statement of Principles (SIP) covers the defined contribution section of the Scheme. It is set out in three parts: 1)
More informationPENSIONS POLICY INSTITUTE. Comparison of pension outcomes under EET and TEE tax treatment
Comparison of pension outcomes under EET and TEE tax treatment Comparison of pension outcomes under EET and TEE tax treatment Executive Summary 1 Introduction 4 1. Impact of tax treatment on a single
More informationFigure 1: Lower volatility does not necessarily mean better returns. Asset A Asset B. Return
November 21 For professional investors and advisers only. Is volatility risk? After a long period without significant market upheavals, investors might be forgiven for pushing volatility down their list
More informationA BETTER RETIREMENT PORTFOLIO FOR MEMBERS IN DC INVESTMENT DEFAULTS
A BETTER RETIREMENT PORTFOLIO FOR MEMBERS IN DC INVESTMENT DEFAULTS JUNE 2014 TALENT HEALTH RETIREMENT INVESTMENTS EXECUTIVE SUMMARY The majority of defined contribution (DC) plan members typically end
More informationPersonal Lifestyle Strategy 2015 Review
S INVESTMENTS LIFE INSURANCE Personal Lifestyle Strategy 2015 Review november 2015 Audience: Brokers and Financial Consultants We launched our Personal Lifestyle Strategy (PLS) in 2010. In order to ensure
More informationNEST consultation response from Dr. Ros Altmann. Independent Pensions Policy Expert
6 January 2015 NEST consultation response from Dr. Ros Altmann. Independent Pensions Policy Expert 1. How will the trend for changing retirement patterns and provision affect a. What members need b. What
More informationDB schemes - Do I stay or do I go?
Issue 1 - June 2016 - For financial advisers only DB schemes - Do I stay or do I go? A client with a deferred pension in a defined benefit (DB) scheme may have the option of taking a transfer value. They
More informationFor BP UK employees. Pension plan investment guide. Pensions Investments Protection
For BP UK employees Pension plan investment guide Pensions Investments Protection This guide is for current members of the Defined Contribution 2010 Pension Plan and BP UK employees who are considering
More informationG4S Personal Pension Plan Employee Guide
G4S Personal Pension Plan Employee Guide Expiry 05/04/16 Section Page number Introduction 1 Contacts 1 What the Plan can offer you 2 How does the Plan work? 3 Contribution levels 4 Contribution limits
More informationUniversity of Reading Pension Scheme
Human Resources University of Reading Pension Scheme Investing for Retirement Introduction After deciding how much to save for retirement, where to invest the contributions that you and the University
More informationEffects on pensioners from leaving the EU
Effects on pensioners from leaving the EU Summary 1.1 HM Treasury s short-term document presented two scenarios for the immediate impact of leaving the EU on the UK economy: the shock scenario and severe
More informationInsights. Building a sustainable retirement plan. From asset allocation to product allocation
Insights Building a sustainable retirement plan From asset allocation to product allocation Philip Mowbray Philip.Mowbray@barrhibb.com Against a background of increased personal retirement wealth, low
More informationYour guide to the investment changes
Your guide to the investment changes This announcement sets out changes to both the Lifecycle Strategy and Freechoice fund range. Please read it carefully. A quick reminder of how the Scheme works Every
More informationTax Alert: Retirement Funds
Tax Alert: Retirement Funds Please take note of the following issues that may have a profound effect on your client s decisions relating to retirement fund actions. Issues that have in the past and could
More informationpartnership pension account A guide to available benefits
partnership pension account A guide to available benefits Contents partnership pension account 3 Paying into your pension 4 Choosing your pension fund 8 How to open a partnership pension account 13 Leaving
More informationHow to... Help your clients use their pensions freedom wisely
How to... Help your clients use their pensions freedom wisely How To Guide Introduction The new pension freedoms that came into effect in April 2015, may, at first, seem like a very attractive prospect.
More informationHow To Calculate A Life Insurance Premium
IMF Seminar on Ageing, Financial Risk Management and Financial Stability The views expressed in this paper are those of the author(s) only, and the presence of them, or of links to them, on the IMF website
More informationONLINE INVESTMENTS OUR FUND RANGE AND INVESTMENTS.
ONLINE INVESTMENTS OUR FUND RANGE AND INVESTMENTS. Why is it important to read this document? This document explains the funds available for you to invest in through our Investment ISA, which is a Stocks
More informationIt s Time to Save for Retirement. The Benefit of Saving Early and the Cost of Delay
It s Time to Save for Retirement The Benefit of Saving Early and the Cost of Delay November 2014 About the Insured Retirement Institute: The Insured Retirement Institute (IRI) is the leading association
More informationGSK Pension Scheme ( the Scheme ) Statement of Investment Principles
GSK Pension Scheme ( the Scheme ) Statement of Investment Principles This Statement of Investment Principles (SIP) covers the defined benefit and the defined contribution sections of the Scheme. It is
More informationWealth management. Guide for private clients
Wealth management Guide for private clients Contents 01 Welcome to Standard Life Wealth 03 Understanding your financial goals 04 Different goals, different approaches 07 What you can expect as a client
More informationRisk Profiling Questionnaire
Risk Profiling Questionnaire Private Client (Short Form) Risk Profiling Questionnaire 1/08 Please note this questionnaire is designed to help us understand which, if any, of the Standard Life Wealth portfolios
More informationSynergy Personal Retirement Savings Account Your guide to how it works
Synergy Personal Retirement Savings Account Your guide to how it works Contents 03 Introduction to a Synergy Personal Retirement Savings Account 04 Why choose Standard Life? 06 You decide how your money
More informationThe Fiducia Guide to Retirement Planning
The Fiducia Guide to Retirement Planning September 2012 Fiducia Wealth Management Limited Dedham Hall Business Centre, Brook Street Colchester, Essex, CO7 6AD Fiducia Wealth Management Limited is authorised
More informationNew Pension Arrangements for Staff in Grades 1 to 5 Information for Active PAS members
New Pension Arrangements for Staff in Grades 1 to 5 Information for Active PAS members Gary Hague, Finance Office Steve Palmer, FriendsLife SPECIAL Introduction Following the recent consultation exercise
More informationMACQUARIE LIFETIME INCOME GUARANTEE POLICY
MACQUARIE LIFETIME INCOME GUARANTEE POLICY series 1: Product disclosure statement issued 8 march 2010 Important NOTICE This Product Disclosure Statement ( PDS ) is dated 8 March 2010 and together with
More informationThoughtCapital. Investment Strength and Flexibility
Investment Strength and Flexibility Principal Trust SM Target Date Funds The Principal Trust SM Target Date Funds (Target Date Funds) are designed to capitalize on the growing popularity of Do-It-For-Me
More informationLTA Tax charges The clock is ticking
LTA Tax charges The clock is ticking The LTA tax charges 1 of 12 Hundreds of thousands of pension savers in the UK risk being hit by hefty taxes as a result of the latest cut in the pension Lifetime Allowance
More informationYour investment options University of Reading Pension Scheme
Human Resources Your investment options University of Reading Pension Scheme Introduction If you are a member of the University of Reading Pension Scheme (the Scheme) you and your employer pay contributions
More informationStrategies for a more secure retirement
Investment insight February 2013 Jerome Bodisco Investment Research Strategist ThreeSixty As retirement approaches, protecting investments becomes more important than ever. One of the main financial risks
More informationFreedom and choice in pensions RESPONSE FROM ICAS TO HM TREASURY
Freedom and choice in pensions RESPONSE FROM ICAS TO HM TREASURY 11 June 2014 CA House 21 Haymarket Yards Edinburgh EH12 5BH enquiries@icas.org.uk +44 (0)131 347 0100 icas.org.uk Direct: +44 (0)131 347
More informationKey features of the Home Retail Group Personal Pension Plan
Key features of the Home Retail Group Personal Pension Plan This is an important document which you should keep in a safe place. You may need to read it in future. Home Retail Group Personal Pension Plan
More informationEXCELSIOR INVESTMENTS. Post-Retirement
Your financial planning does not retire when you do Your retirement has finally arrived and a long-awaited chapter in your life begins. By now you should have built up an adequate capital base to provide
More informationKEY GUIDE. Investing for income when you retire
KEY GUIDE Investing for income when you retire Planning the longest holiday of your life There comes a time when you stop working for your money and put your money to work for you. For most people, that
More informationKEY FEATURES OF THE PERSONAL PENSION (TOP UP PLAN) Important information you need to read
KEY FEATURES OF THE PERSONAL PENSION (TOP UP PLAN) Important information you need to read THE FINANCIAL CONDUCT AUTHORITY IS A FINANCIAL SERVICES REGULATOR. IT REQUIRES US, SCOTTISH WIDOWS, TO GIVE YOU
More informationTaking control of your future
The Association of Investment Companies Taking control of your future A guide to Self-Invested Personal Pensions September 2014 www.theaic.co.uk The Association of Saving for your retirement is one of
More informationI want the security of a guaranteed income for my retirement
Retirement Secure Advantage+ Pension Plan I want the security of a guaranteed income for my retirement A guide to the Secure Advantage+ Pension Plan with optional Lifetime Income Benefit feature, for customers
More informationGUIDE TO RETIREMENT PLANNING FINANCIAL GUIDE. Making the most of the new pension rules to enjoy freedom and choice in your retirement
GUIDE TO RETIREMENT PLANNING Making the most of the new pension rules to enjoy freedom and choice in your retirement FINANCIAL GUIDE WELCOME Making the most of the new pension rules to enjoy freedom and
More informationFrequently Asked Questions on Retirement Reform
Frequently Asked Questions on Retirement Reform Background on retirement reforms 1. What is retirement reform? Retirement reform is a process whereby government, through policies, seeks to: - Encourage
More informationKey features of the Aviva Self Invested Personal Pension
Key features of the Aviva Self Invested Personal Pension Retirement Investments Insurance Health Key features of the Aviva Self Invested Personal Pension The Financial Conduct Authority is a financial
More informationSTAKEHOLDER PENSIONS FUND SELECTION IT S ALL ABOUT CHOICE
STAKEHOLDER PENSIONS FUND SELECTION IT S ALL ABOUT CHOICE A SCOTTISH WIDOWS STAKEHOLDER PENSION IS A WAY OF SAVING FOR RETIREMENT. YOUR PENSION CANNOT NORMALLY BE ACCESSED UNTIL YOU REACH AGE 55. We offer
More informationMaking the most of your tax-free allowances
UNISONMONEYTALK The personal finance newsletter for UNISON members published by Lighthouse Financial Advice Autumn 2015 Making the most of your tax-free allowances A key consideration for anyone with money
More informationSelf Select Investment Guide move ahead
Self Select Investment Guide move ahead For members of The Barclays Bank UK Retirement Fund (the UKRF) 2 Self Select Investments move ahead Inside this guide Welcome to Self Select 2 Investments Choosing
More informationUNDERSTANDING YOUR FUTURE CREATE A PICTURE OF YOUR RETIREMENT
UNDERSTANDING YOUR FUTURE CREATE A PICTURE OF YOUR RETIREMENT CONTENTS My Future 2 Your Family 2 Your Property 3 Your Assets 3 Your Future Summary 4 Your Retirement 4 Your Future Income 5 Details & Events
More informationTaking Target Date Fund Evaluation to the Next Level
Taking Target Date Fund Evaluation to the Next Level Lori Lucas Defined Contribution Practice Leader Callan Associates Chicago, Illinois The opinions expressed in this presentation are those of the speaker.
More informationability to accumulate retirement resources while increasing their retirement needs; and
Consulting Retirement Consulting Talent & Rewards The Real Deal 2012 Retirement Income Adequacy at Large Companies RETIREMENT YOU ARE HERE About This Report This study assesses whether employees of large
More informationThoughtCapital. Strategic Diversification for a Lifetime Principal LifeTime Portfolios
Strategic Diversification for a Lifetime Principal LifeTime Portfolios The Principal LifeTime portfolios were launched in response to participants increasing interest in having Do It For Me investment
More informationSTAKEHOLDER PENSION. KEY FEATURES. This is an important document that you should read and keep in a safe place. You may need to read it in future.
STAKEHOLDER PENSION KEY FEATURES. This is an important document that you should read and keep in a safe place. You may need to read it in future. 2 STAKEHOLDER PENSION KEY FEATURES USING THIS DOCUMENT.
More informationPLANNING THE RETIREMENT YOU WANT
PLANNING THE RETIREMENT YOU WANT Charlotte Supply Chain Graduate HEINEKEN UK Flexible Retirement Plan Contents A reminder of... How the Flexible Retirement Plan works 4 The benefits 6 Consider what you
More informationWhat next? Even with the best of maps and instruments, we can never fully chart our journeys.
Life-cycle strate gies What next? Even with the best of maps and instruments, we can never fully chart our journeys. Gail Pool Life-cycle investment strategies were designed some years ago in the United
More informationWILLIS BREAKFAST SEMINAR
WILLIS BREAKFAST SEMINAR Defined Contribution Investment How To Achieve Better Outcomes For Members Thursday, 13 th March 2014 WELCOME AGENDA Introduction 8.00am Kirstie Flynn Defined Contribution Challenges
More informationAnnuities and decumulation phase of retirement. Chris Daykin UK Government Actuary Chairman, PBSS Section of IAA
Annuities and decumulation phase of retirement Chris Daykin UK Government Actuary Chairman, PBSS Section of IAA CASH LUMP SUM AT RETIREMENT CASH INSTEAD OF PENSION > popular with pension scheme members
More informationSynergy Buy Out Bond Financial adviser guide
Synergy Buy Out Bond Financial adviser guide Contents 03 Help your clients keep track of their pension investments 04 What is a buy out bond? 05 What the rules say... 06 Key reasons to recommend a Synergy
More informationOptions available when deciding to take pension benefits
Options available when deciding to take pension benefits You can now use the money that has built up in your pension fund to provide you with an income in retirement. An income can be provided in any of
More informationWealth management Guide for financial advisers
Wealth management Guide for financial advisers Wealth management 1 Contents 01 Welcome to Standard Life Wealth 03 Why choose Standard Life Wealth to work with? 04 How we aim to meet your clients financial
More informationRetirement Account Plan Key features
Retirement Account Plan Key features This is an important document. Please read it and keep for future reference. The Financial Conduct Authority is a financial services regulator. It requires us, Standard
More informationMEETING THE RETIREMENT INCOME CHALLENGE APRIL 2013
MEETING THE RETIREMENT INCOME CHALLENGE APRIL 2013 INTRODUCTION The Australian retirement system is generally regarded globally as being well advanced, ranking third in the 2012 Mercer Melbourne Global
More informationMacquarie Longevity Solutions. Macquarie Lifetime Income Guarantee
Macquarie Longevity Solutions Macquarie Lifetime Income Guarantee How can Macquarie help? The Macquarie Lifetime Income Guarantee Policy provides you with a flexible, low cost investment which guarantees
More informationM&G Guide to Retirement Income
M&G Guide to Retirement Income 2 Working out how to make adequate financial provision for retirement is one of the most important financial decisions most of us will ever face. However, it can be a daunting
More informationInsights. Did we spot a black swan? Stochastic modelling in wealth management
Insights Did we spot a black swan? Stochastic modelling in wealth management The use of financial economic models has come under significant scrutiny over the last 12 months in the wake of credit and equity
More informationSelf Invested Personal Pension for Wrap Key Features
Self Invested Personal Pension for Wrap Key Features This is an important document. Please read it and keep for future reference. The Financial Conduct Authority is an independent financial services regulator.
More informationCan DC members afford to ignore inflation?
May 2013 Can DC members afford to ignore inflation? Mark Humphreys, Head of UK Strategic Solutions, Schroders Introduction Around 95% of individuals are forgoing inflation protection for their retirement
More informationInvestment Implications for UK DC Schemes in Light of Tax and Regulatory Changes
Investment Implications for UK DC Schemes in Light of Tax and Regulatory Changes November 19, 2014 by William Allport of PIMCO With greater flexibility and choices available to DC savers in the latter
More informationYour retirement income. Exploring your options
Your retirement income Exploring your options Contents 01 Accessing your pension savings with Standard Life 03 What do you want to do with your pension pot? 09 A regular retirement income for the rest
More informationFlexible Income Annuity. An income for life with the potential to grow
Flexible Income Annuity An income for life with the potential to grow Introducing Retirement Advantage Previously known as MGM Advantage and Stonehaven, we are a well-established company that can trace
More informationINVESTMENT POTENTIAL,
ADD POWER TO YOUR INVESTMENT POTENTIAL, CHOOSE THE M&G ISA 2 CONTENTS What is an ISA? 3 The key benefits of ISA investing 4 Reasons to invest in The M&G ISA 6 What is a Junior ISA? 7 The key benefits of
More informationPensions Freedom. What do the pension changes really mean? This is for information purposes only.
Pensions Freedom What do the pension changes really mean? This is for information purposes only. Pensions Freedom March Budget 2014 introduced unprecedented changes to how pension benefits can be taken
More informationReal solutions designed to improve participant outcomes.
DEFINED CONTRIBUTION SOLUTIONS Real solutions designed to improve participant outcomes. INVESTED. TOGETHER. Is your DC plan keeping pace with today s DC challenges? DC PLANS ARE CHANGING. Today, many workers
More informationInvestment Strategy for Pensions Actuaries A Multi Asset Class Approach
Investment Strategy for Pensions Actuaries A Multi Asset Class Approach 16 January 2007 Representing Schroders: Neil Walton Head of Strategic Solutions Tel: 020 7658 2486 Email: Neil.Walton@Schroders.com
More informationHow Does Money Grow Over Time?
How Does Money Grow Over Time? Suggested Grade & Mastery Level High School all levels Suggested Time 45-50 minutes Teacher Background Interest refers to the amount you earn on the money you put to work
More informationTarget-date funds: the to versus through dilemma
November 14 Target-date funds: the to versus through dilemma Leo M. Zerilli, CIMA Head of Investments John Hancock Investments Recent U.S. Department of Labor guidance on target-date funds provides helpful
More informationGroup Additional Voluntary Contributions Plan Key features
Group Additional Voluntary Contributions Plan Key features This is an important document. Please read it and keep for future reference. The Financial Conduct Authority is a financial services regulator.
More informationTHE END OF PENSIONS? Consultants Corner
THE END OF PENSIONS? By Charlotte Moore It s no exaggeration to call the pension changes announced in this year s Budget revolutionary: this reform could herald the end of pensions and usher in a new era
More informationThe Personal Range. Choosing your investment funds
The Personal Range Choosing your investment funds Choosing your investment funds To enable you to do more of the things you enjoy in your retirement, your pension savings will need to work hard for you.
More informationFranklin Templeton SIMPLE IRA EMPLOYEE S GUIDE
Franklin Templeton SIMPLE IRA EMPLOYEE S GUIDE Franklin Templeton SIMPLE IRA Roadmap to Retirement You ve been offered an opportunity to participate in a Franklin Templeton SIMPLE IRA (Savings Incentive
More informationretirement planning the retirement you want Heineken UK Flexible Retirement Plan
my retirement planning the retirement you want Heineken UK Flexible Retirement Plan Contents Get an overview of the Heineken UK Flexible Retirement Plan What is the Flexible Retirement Plan? 4 Your benefits
More informationCollective Retirement Account
Key features of the Collective Retirement Account The Financial Conduct Authority is a financial services regulator. It requires us, Old Mutual Wealth, to give you this important information to help you
More informationUK Debt Management Office CPI linked Gilts: A Consultation Document
UK Debt Management Office CPI linked Gilts: A Consultation Document NAPF Response September 2011 www.napf.co.uk 2 NAPF Response UK Debt Management Office: CPI linked Gilts: A Consultation Document NAPF
More informationAnnuity strategic lifestyle profiles
Annuity strategic lifestyle profiles Our Annuity strategic lifestyle profiles (SLPs) are designed to be appropriate for customers who plan to take their full tax-free lump sum and buy a fixed annuity with
More information