Passive Plus III Universal Strategic Lifestyle Profile

Transcription

1 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 to be an appropriate option for many people s pension plan investments. The Passive Plus III Universal SLP is designed to be a simple option if you re investing for retirement and want to save time choosing and managing your investments. Our experts will: manage your money for you right up until you take your retirement income decide where you should be invested and when make sure the funds you re in don t take any more or less risk than they should There are two main stages in the Passive Plus III Universal SLP: 1. Growth stage usually when you re more than 10 years from retirement Your money will be invested in the Standard Life Passive Plus III Pension Fund, which aims to increase the value of your pension over time. Please remember that investment growth is not guaranteed. All funds can go up as well as down in value and may be worth less than the amount invested. 2. Approaching retirement stage usually when you re less than 10 years from retirement Your money will gradually be moved into lower risk funds designed to give you the flexibility to take it as you want when you retire, or to be appropriate if you want to take a flexible income (known as drawdown). This will happen automatically you don t need to do anything. One of the features of this SLP is flexibility. We can make changes to it at any time to make sure it continues to meet your needs, for example because of changes in legislation. Passive Plus III Universal Strategic Lifestyle Profile 01/08

2 Before making this choice, you should: consider how you plan to take your retirement income. This SLP is designed to give you the flexibility to take your money the way you want when you retire. We have other SLPs which may be more appropriate if you know you want to take your full tax-free lump sum and buy a fixed annuity, or if you know you want to take all of your pension as a lump sum or series of lump sums. You can find out more about these in our Annuity strategic lifestyle profiles and Lump Sum strategic lifestyle profiles guides. consider when you ll take your retirement income. This SLP makes changes to your investments based on your selected retirement date. So, it may only be suitable if you re planning to take your retirement income on this date. If you aren t sure if this SLP is suitable for you, you should speak to a financial adviser. You can easily move into another SLP at any time if your retirement income plans change. How it works The chart on the next page shows how the funds you invest in will vary during the years before your selected retirement date. However, we may change when we move your investments, and the mix of funds within the SLP. We review this every year, and make any changes that are needed. We can also make changes to them at any time, for example because of changes in legislation. See the About the funds section for more information about the funds in the Passive Plus III Universal SLP. 02/08 Passive Plus III Universal Strategic Lifestyle Profile

3 Passive Plus III Universal SLP (U3PP) % of investments > months Years to retirement Fund name Standard Life Passive Plus III Pension Fund Standard Life Pre Retirement (Passive Plus Universal) Pension Fund Standard Life At Retirement (Passive Plus Universal) Pension Fund Fund code Volatility rating FMC Additional expenses Total annual fund charge CCHD % 0.03% 1.03% Active KKFF % 0.03% 1.03% Active JJHA % 0.03% 1.03% Active Active/Passive investment The charges are not guaranteed. They are regularly reviewed and may be changed in the future. The information in this guide is correct as at January If you need more help to understand this table, including an explanation of active/passive investments, please see the How to choose the right investment options for your pension guide. Passive Plus III Universal Strategic Lifestyle Profile 03/08

4 About the funds Here are some details about the funds that make up the Passive Plus III Universal SLP. Some of the fund descriptions might use words or phrases you re not familiar with. Speak to your financial adviser if you need an explanation. There may be a cost for this. For information about asset classes, volatility ratings, and charges and investment approaches of these funds, please see the How it works section and the How to choose the right investment options for your pension guide. Standard Life Passive Plus III Pension Fund (CCHD) The goal of this fund is to provide long term growth while being managed to a level of risk, rather than a level of return. The fund is part of the Passive Plus range, which aims to offer five different combinations of investment risk and return levels. Simply choose the fund which most closely matches your attitude to risk and return and a team of experts will do the rest. This fund is risk level III, which aims to be the middle fund in this range. As such, this level invests in both lower risk investments such as money market instruments and certain types of bonds, and higher risk investments such as equities and property. This may suit you if you have a balanced attitude to risk; not seeking risky investments but not avoiding them either, accepting fluctuations in the value of your investment to try and achieve better long term returns. The fund aims to meet this goal by holding different types of investment funds, such as those investing in equities (shares), bonds (loans to a government or company) and non-residential property (such as offices, shopping centres and shares in property development companies). The investments in the fund can be from around the world, including emerging markets, which means that some of them will be in a foreign currency. The fund can also invest in absolute return funds that aim to provide positive investment returns, regardless of whether markets are going up or down, over the medium to long term. They do this by using a wide range of investment strategies including those using derivatives. Derivatives are financial instruments whose value comes from movement in other investments, such as equities and currencies. Most of the investment funds used are tracker funds which means that their return, before charges, will be as close to the broad market they invest in as possible. The fund also invests in actively managed 04/08 Passive Plus III Universal Strategic Lifestyle Profile

5 absolute return, property and high yield bond funds which means that a team of experts will pick the investments to be held. These decisions are based on the opportunities they ve identified through their analysis. Standard Life Pre Retirement (Passive Plus Universal) Pension Fund (KKFF) This fund is used to start gradually moving your money out of the growth phase of a Universal strategic lifestyle profile (SLP), into a mix of lower risk investments which are considered appropriate if you have yet to decide how you re going to take your retirement income or if you want to take a flexible income (known as drawdown). It isn t suitable as a standalone fund or if you re building your own portfolio from our full fund range. The fund aims to meet its goal by holding different types of investment funds, such as those investing in equities (shares), bonds (loans to a government or company) and non-residential property (such as offices, shopping centres and shares in property development companies). These investments can be from around the world, including emerging markets, which means that some of them will be in a foreign currency. The fund can also invest in absolute return funds that aim to provide positive investment returns, regardless of whether markets are going up or down, over the medium to long-term. They do this by using a wide range of investment strategies including those using derivatives. Derivatives are financial instruments whose value comes from movement in other investments, such as equities and currencies. All investments are reviewed regularly to make sure they remain suitable for the fund s goal, and may change over time. The fund doesn t provide any guarantee about the level of retirement income you ll receive. Standard Life At Retirement (Passive Plus Universal) Pension Fund (JJHA) The goal of this fund is to make sure that at your retirement date your money is in investments which are considered appropriate if you have yet to decide how you re going to take your retirement income or if you want to take a flexible income (known as drawdown). It s used as part of a Universal strategic lifestyle profile (SLP), and isn t suitable as a standalone fund or if you re building your own portfolio from our full fund range. Passive Plus III Universal Strategic Lifestyle Profile 05/08

6 The fund aims to meet its goal by holding different types of investment funds, such as those investing in equities (shares), bonds (loans to a government or company) and non-residential property (such as offices, shopping centres and shares in property development companies). The investments in the fund can be from around the world, including emerging markets, which means that some of the investments will be in a foreign currency. The fund can also invest in absolute return funds that aim to provide positive investment returns, regardless of whether markets are going up or down, over the medium to long-term. They do this by using a wide range of investment strategies including those using derivatives. Derivatives are financial instruments whose value comes from movement in other investments, such as equities and currencies. As you can normally take a tax-free lump sum from your pension pot, some of the fund is invested in lower risk money market funds. There are circumstances where money market instruments can fall in value. All investments are reviewed regularly to make sure they remain suitable for the fund s goal, and may change over time. The fund doesn t provide any guarantee about the level of retirement income you ll receive. Important information Before making your investment choices, please make sure you read the following information, which includes details of some of the risks you should be aware of. If you re still not sure what to do, you may want to speak to a financial adviser. There may be a cost for this. If you choose to invest in the Passive Plus III Universal SLP, you can only combine this with a with profits fund (where available). You cannot combine this with any other fund, or any other SLP or lifestyle profile. The return on each fund depends on the performance of the assets it invests in and the charges on the fund. The price of units depends on the value of the fund s assets after charges. This can go down as well as up, and your investment may be worth less than what was paid in. Some funds invest in overseas assets. This means that exchange rates and the political and economic situation in other countries can significantly affect the value of these funds. The value can go down as well as up, and your investment may be worth less than what was paid in. 06/08 Passive Plus III Universal Strategic Lifestyle Profile

7 The asset mix that each fund invests in is continuously reviewed. It may be changed in line with developments in the relevant markets. Part of each fund may be held in cash and other money market instruments see the How to choose the right investment options for your pension guide for more information. You ll probably be one of many investors in each fund you choose. Sometimes, in exceptional circumstances, we may have to wait before we can transfer or switch your funds. This is to maintain fairness between those remaining in and those leaving the fund. This delay could be for up to a month. But for some funds, the delay could be longer: It may be for up to six months if it s a property based fund because property and land can take longer to sell. If our fund invests in an external fund, the delay could be longer if the rules of the fund allow this. If we have to delay a transfer or switch, we ll use the fund prices on the day the transaction takes place these prices could be very different from the prices on the day you made the request. Some funds invest in property. The valuation of property is generally a matter of a valuer s opinion rather than fact. Some funds invest in funds managed by external fund managers. In these cases, the description of the fund is provided by the external fund manager so Standard Life can t guarantee that it s accurate. External fund managers are in charge of managing their own funds including what they invest in. This means that Standard Life is not responsible for these funds performance or continued availability. The investment performance of the Standard Life version of a fund will be different from what you would see if you invested in the underlying fund directly. There can be several differences, due to charges, cash management, tax and the timing of investing. Some fund managers may look to get a better return by lending some of the assets to certain financial institutions. This involves some risk, and in certain circumstances, the fund could suffer a loss for example, if the institution encountered financial difficulties and was unable to return the asset. The fund manager will use some controls to manage this risk, such as obtaining security from the borrower and monitoring their credit rating. External fund managers may also lend assets and are responsible for their own controls. Passive Plus III Universal Strategic Lifestyle Profile 07/08

8 Funds can sometimes use derivatives to improve portfolio management and to help meet investment objectives. A derivative is a financial instrument its value is derived from the underlying value or movement in other assets, financial commodities or instruments, like equities, bonds, interest rates, etc. There is a risk that a counterparty will fail, or partially fail, to meet their contractual obligations under the arrangement. Where a counterparty fails, the fund could suffer a loss. As part of the management of a fund, a number of controls can be used to reduce the impact of this risk, such as holding collateral and monitoring credit ratings. Depending on how it is used, a derivative can involve little financial outlay but result in large gains or losses. Standard Life has control over the use of derivatives in its funds and external fund managers are responsible for their own controls. This SLP was correct when this document was published. We can t guarantee that it will be available when you make an investment. If you re unsure about your attitude to risk and whether the Passive Plus III Universal SLP is appropriate for you, we have a risk questionnaire to help you. You can find this on your company pension website. As well as considering your attitude to investment risk, you should consider how much risk you re able to take, bearing in mind your other financial commitments and personal circumstances. Standard Life Assurance Limited is registered in Scotland (SC286833) at Standard Life House, 30 Lothian Road, Edinburgh EH1 2DH. Standard Life Assurance Limited is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. SLPPIII Standard Life 08/08