Your investment options

In this example, the Plan member may have more than 15 years until they will access the benefits available from the plan.

With an eye on the long-term, it’s important to consider the effect that inflation can have on the value of the investment. If the funds chosen have a low potential for return – usually these funds have a lower volatility risk – there is a risk that the investment returns may be lower than inflation. That means, over time the value actually falls in real terms.

Investment funds with a higher volatility will usually have a higher potential for growth, which can help them to grow by more than inflation. So, over time, the value of the investments increases in real terms.

You can choose any of the investments offered by the Plan, but to help you, the Trustee and their adviser have indicated the funds with a 3, 4 or 5 under the 'growth' column which may be more appropriate for members like this, depending on the level of volatility that the member is comfortable with. These are investments with higher potential growth and varying levels of volatility risk.

Show all the investment funds

In this example, the Plan member may have less than 15 years until they will access the benefits available from the Plan. They may also have built up some savings towards their pension, either in the Plan or in other pension arrangements they have elsewhere.

With an eye on the medium-term, it’s important to balance the risks of inflation and volatility.

Investment funds with a higher volatility risk will usually have a higher potential for growth. This can help them to grow by more than inflation. So, over time, the value of the investment increases in real terms. With less than 15 years to the date benefits will be taken from the Plan, it would be appropriate to consider funds that have the potential to grow by more than inflation, but with slightly lower volatility risk.

You can choose any of the investments offered by the Plan, but to help you, the Trustee and their adviser have indicated the middle-rated funds in both the 'growth' and 'preparing for retirement' columns which may be more appropriate for members like this, depending on the level of volatility that the member is comfortable with.

Show all the investment funds

In this example, the Plan member may have less than 10 years until they will access the benefits available from the plan.

Depending on how the money in the Plan will be used, the member will need to consider where they want to invest. It’s important to balance the risks of inflation and volatility, and also start to consider which investments are most appropriate for the type of benefits they wish to take

Over the shorter term the effect that inflation has on the real value of savings is lower and the potential growth that can be achieved from investments is also lower as they have less time to grow.

As the value of savings increases and the time left for investment gets shorter, volatility risk can have a bigger effect on the value of your savings.

Type of benefits you might take:

• If you are considering securing a lifetime income (buying an 'annuity') from an insurance company with your Plan savings – you may consider investing in one or more of the Gilt or Bond funds, as these types of asset are used by insurance companies to back their annuities, and can reduce the impact of annuity price changes on your available pension income as you approach retirement.

• If you are considering taking the Plan savings as a cash lump sum, you may consider investing in a low volatility fund such as the Managed Cash fund, so that there is less fluctuation in the value of the fund as you approach retirement.

• If you are looking to draw an income from your savings while leaving the rest invested, you may wish to invest some of your savings in a fund that is slightly more volatile but still provides the potential for growth over a longer term, so you may consider funds such as the Multi Asset fund, the Diversified Growth Fund, or one or more of the Equity funds.

You can choose any of the investments offered by the Plan, but to help you, the Trustee and their adviser have indicated the funds with a 3, 4 or 5 under the 'preparing for retirement' column which may be more appropriate for members like this, depending on the level of volatility that the member is comfortable with and how the member might take income in retirement.

Show all the investment funds

Find out more about preparing for retirement

The Trustee and their adviser have chosen this range of investment funds for members of the DC Top-up Section. Members can invest in any of these funds throughout the lifetime of their Plan membership.

Some funds, however, may be more suitable for members who are, for example, more than 15 years from retirement and aiming to grow their pension savings as much as possible. This is known as the 'growth' phase.

Others may be more suitable for members when they get closer to the point that they want to take their benefits. This is known as the 'preparing for retirement' phase.

The Trustee has given the funds a rating from 1 to 5 for each phase - 1 being less suitable and 5 being more suitable. If you are moving between the 'growth' and 'preparing for retirement' phases, this is known as the 'consolidation' phase. During this phase, you might want to select those with moderate ratings for both of the other phases.

You can also see an indicative volatility rating from 0 (less volatile) to 7 (more volatile) against each fund in the table below.

The ratings are just a guide and if you’re not sure which funds are right for you, you should get help from a financial adviser.

You can read more about each of the investment funds, including their objectives in the factsheets linked from each fund name.

The investment funds you already hold don't need to be replaced by these funds, but you may decide to move some of the funds you have built up and/or future contributions into a combination of investment funds by adding one or more of those listed below. Remember, you can use our tool to understand more about your attitude to volatility risk.

This information is correct as at June 2018.

Fund name	Growth phase	Preparing for retirement phase	Effective total annual fund charge	Volatility
SL Global Emerging Market Equity CP Pension Fund	***** (5)	* (1)	1.28%	7
SL Active Global Equity CP Pension Fund	***** (5)	* (1)	0.95%	6
SL Active UK Equity Fund CP Pension Fund	***** (5)	* (1)	0.70%	6
SL UK and Overseas Equity CP Pension Fund	**** (4)	** (2)	0.38%	6
SL Passive UK Equity CP Pension Fund	**** (4)	** (2)	0.30%	6
SL Shariah CP Pension Fund	**** (4)	** (2)	0.59%	6
SL Ethical CP Pension Fund	**** (4)	** (2)	0.30%	5
SL Passive Overseas Equity CP Pension Fund	**** (4)	** (2)	0.31%	5
SL Fixed Interest Bond CP Pension Fund	** (2)	**** (4)	0.30%	5
SL Index Linked Bond CP Pension Fund	** (2)	**** (4)	0.31%	5
SL Corporate Bond CP Pension Fund	** (2	**** (4)	0.30%	3
SL Diversified Growth CP Pension Fund	*** (3)	*** (3)	0.95%	3
SL Multi Asset CP Pension Fund	*** (3)	*** (3)	0.88%	3
SL Managed Cash CP Pension Fund	* (1)	***** (5)	0.30%	1
SL Factor Based Global CP Pension Equity	****(4)	**(2)	0.44%	6

Investment funds are generally given names that tell you what they invest in, for example UK Equity, Index Linked Bond etc. If you look at the factsheets relating to these funds they tell you what the fund is invested in in more detail.
 
There are funds, however, where the name is less specific about what they invest in. The Multi Asset Fund, for example invests in many different assets with the aim of achieving growth in many different economic conditions. The Diversified Growth Fund aims to generate growth over the long term but with lower volatility that the equity-only funds.
 
When you are choosing your funds you should take into account the mix of assets you are investing in and whether to use single-asset type funds, mixed asset type funds or a combination.
 
You might also consider using different types of assets at different points of your savings career.

'Passive' management means that the fund manager is holding assets that match those of a market index – for example the Passive UK Equity Fund aims to track the FTSE All Share index. It has a relatively low charge reflecting the fact that it is a passive fund.
 
'Active' management means that the fund manager is seeking to provide some additional value by making decisions about in what to invest the fund. Active equity funds, for example, will be aiming to perform better over the long term than the market index that they measure their fund against, but do not guarantee to do so. For this you pay a higher charge.