The value of investments can go down as well as up, and your members could get back less than was paid in.
Off-the-shelf - the easiest investment options for your scheme
All good workplace pension plans rely on sound and sustainable investment choices.
But too much choice can be overwhelming, and many individuals simply don't have the time, the confidence or even the wish to select and manage their own investment choices.
That's fine. We're here to help. Our low-involvement default solution is designed to make it as straightforward as possible for absolutely anyone to save for their retirement.
What is a default investment option?
As an employer choosing a pension scheme, you need a default investment option that’s suitable for the vast majority of your members - not just today but for the future too. Having a suitable default makes sure your members’ pension money will be invested appropriately, even if they don't make an active investment choice themselves.
The Pensions Regulator carried out research into DC schemes which found that 95% of members stay in the default investment, so it's important to ensure your default solution meets your members' needs. Typically default investment options are extensively governed to make sure they stay appropriate into the future for all those who don’t want to make their own investment decisions.
Sustainable Multi Asset Universal Strategic Lifestyle Profile (SLP)
Sustainable Multi Asset Universal is our low-involvement default solution:
- It is designed to make saving for retirement easy.
- It aims to grow capital in the initial years of the savings journey, before aiming to preserve it as members approach retirement.
- It focuses on the financial risks associated with sustainability, providing peace of mind for members that their money is being invested responsibly.
And that's not all. Because it recognises that many members are unsure how they want to access their retirement savings, our Universal approach offers them flexibility to take their money how they would like to when they retire.
And for those who have a plan in mind, there are annuity purchase, lump sum and drawdown options.
We've built it to be adaptable in the face of change. So whether it is changes in market conditions or regulation, we can adapt it with minimal disruption to members.
How does Sustainable Multi Asset Universal work?
The design recognises that member needs change as they progress through their retirement journey.
1. Preparing for retirement - focus on capital growth
When the member is 15 years or more from their selected retirement age, they are invested in a fund that aims to grow the size of their pension savings.
2. Approaching retirement - focus on capital preservation
When the member gets closer to their selected retirement age, their pension savings are automatically and gradually moved into funds that are usually lower risk to begin to prepare their money for retirement.
3. At retirement stage
When your members are usually only a few years away from retirement their money gradually starts to move to funds that aim to make sure they're in the right investments for their retirement aim.
How Sustainable Multi Asset invests responsibly
Responsible investment considerations are at the heart of Sustainable Multi Asset. The solution focuses on ESG factors we believe are financially material, seeking to help members do good with their pension money. We deliver this through a blend of ESG techniques.
- Screening out
We actively screen out companies we believe can pose significant sustainability risks
- Investing more
We invest more in companies that we believe can improve sustainable outcomes
- Driving change
We challenge our fund managers to encourage positive change in the companies they invest in
Why choose Sustainable Multi Asset Universal SLP?
Suitable for most members
Specifically designed to meet the needs of the majority of members, our Universal approach offers flexibility to take their money how they want when they retire.
Our aim is to provide a good income replacement rate in retirement. It is designed to be able to deliver the growth required to achieve a PLSA Moderate income, with a member contributing at the appropriate level.
Focusing on ESG factors that we believe can have a material impact on potential growth
Designed to be adaptable to long-term changes in market conditions or regulation.
Focus on growth
Seeking to maximise growth in the initial years of the retirement journey. A 15 year glide-path helps reduce risk as the member gets closer to retirement.
The use of sustainable index funds helps keep charges low
Other investment choices for members
While we believe Sustainable Multi Asset Universal SLP is a good choice for most members, we know there will be some who may want to be more involved in their investment choice.
"Help me do it"
Sustainable Multi Asset Universal offers flexibility to members. But if your members already have a clear idea of how they'd like to take their money in retirement, there are specific options to choose from:
- Sustainable Multi-Asset Annuity (a guaranteed regular income)
- Sustainable Multi-Asset Drawdown
- Sustainable Multi-Asset Lump Sum
That means your members benefit from the same investment principles as for the Universal SLP, but their retirement outcome is more sharply focused.
We also have additional responsible investment options that allow members to choose a risk level to suit their needs.
"Let me do it" - self-select fund options
If some of your members are more confident or interested in investment, that's fine; we have a wide range of funds covering key asset classes and investment approaches.
To ensure our funds remain fit for purpose there is a multi-layer governance/oversight approach for workplace members:
Performance analysis of fund by sector and asset class
Operational analysis, fund design and suitability assessment
Fund Manager and Fund review
|Standard Life Master Trust Co Ltd Governance||Quarterly
Performance analysis and fund suitability evaluation
Value for money assessment completed (with support from an independent investment adviser) and detailed analysis published in Chairs yearly report
|At least every three years
Review of investment options available to members (with support from an independent investment adviser)
|Independent Governance Committee Oversight||Monthly
Monthly meetings between Standard Life and IGC Investment Leads
Performance analysis and fund suitability evaluation
Value for money assessment completed with support of independent investment consultancy, detailed analysis published in IGC yearly report