Making retiring with flexibility easier
We’re delighted to offer four new options to employees – building on the work by the Financial Conduct Authority (FCA) to help improve retirement outcomes for employees who want to flexibly access their pension savings.
We’ve introduced four new ‘investment pathways’ aimed at the needs of your employees.
What does this mean for my employees?
Each investment pathway is designed to meet a specific retirement goal. Employees will be presented with four options and asked to choose the one that most closely matches their needs:
- Option 1: I have no plans to touch my money in the next 5 years.
- Option 2: I plan to use my money to set up a guaranteed income (annuity) within the next 5 years.
- Option 3: I plan to start taking my money as a long-term income within the next 5 years.
- Option 4: I plan to take out all my money within the next 5 years.
Once they’ve chosen an option, employees will be offered an investment pathway solution which they can select, and they’ll be reminded about their chosen investment pathway in their yearly statement.
Employees don’t have to choose an investment pathway; they can stay invested in their current investments (if available) or choose their own investments.
Of course, investment returns are never guaranteed. So while there's a chance your employees' pension savings can grow, their value can also go down. This means they could get back less than they started with.
Our investment pathways solutions
We offer a choice of four pathways, based on what your employees intend to do with their pension savings over the next five years. Each investment pathway invests in a mix of funds and asset classes and aims to meet different retirement needs, as shown in the table below.
| Option 1: I have no plans to touch my money in the next 5 years |
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Investment pathway 1: aims to deliver growth above inflation for a customer who has no short-term plans to access their savings. |
| Option 2: I plan to use my money to set up a guaranteed income (annuity) within the next 5 years |
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Investment pathway 2: aims to maintain annuity buying power for a customer looking to buy an annuity in the short-term. |
| Option 3: I plan to start taking my money as a long-term income within the next 5 years |
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Investment pathway 3: aims to deliver growth above inflation to support sustainable income withdrawal. |
| Option 4: I plan to take out all my money within the next 5 years |
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Investment pathway 4: aims to offer the potential for above inflation growth while supporting short termwithdrawal needs. |
Find out more
We believe that these new options will provide your employees with easy choices and flexibility when they decide it’s time to access their pension savings.
View and download our investment pathways factsheets to find out more.