The Default Fund Makeover: from one-size-fits-all to bespoke tailoring

DC relies primarily on investment return. The shift from DB to DC has moved all of the responsibility and risk on to the employees. And, despite previous attempts, employees are not able to become self sufficient. Consequently we see very high levels of employees using the default funds.  

There is therefore increased pressure on getting the default investment strategy correct.  We have seen default strategies develop over the last 10 years, from with profits, through to passive funds as part of a lifestyling strategy.

In examining this theme, this paper looks at some of these issues in detail, and also at how defaults can move forward, including how they can adapt to future change and be as "future proofed as possible".