Your Investments
The default fund
The current default fund for all new joiners is the Legal & General (PMC) Multi-Asset Fund. This approach is designed specifically to provide members with growth during the majority of their working lives and then greater security as they approach retirement.
To find out which fund(s) you are currently invested in, please refer to your latest annual benefit statement produced by Legal & General or access your Legal & General plan details on MyAccount, as you may not be invested in the current default fund.
How does the default work?
The Legal & General (PMC) Multi-Asset Fund aims to provide long-term investment growth through exposure to a diversified range of asset classes. The diversified nature of the fund means that the fund is expected to have less exposure to adverse equity market conditions than an equity-only fund. However, the fund may perform less strongly than an equity-only fund in benign or positive market conditions.
You can find out more about the default fund by clicking here.
Performance
Investment performance is one of the key factors in building a worthwhile retirement fund. If you log into your Legal & General account here you can find out the performance of the fund(s) you are invested in, the fund factsheets and a whole lot more!
Tumelo…coming soon!
Our pension provider Legal & General, have partnered with Tumelo which provides a platform for pension members to have a transparent view of the companies they invest in.
Tumelo also provides members with a shareholder voice and an opportunity to vote on issues they care about, from climate change to gender equality. You’ll be able to have your say on the big decisions being discussed at those companies annual general meetings!
We are working with Legal & General to implement Tumelo later in the year. We’ll provide you with more updates as soon as we are ready to launch.
One year on from the outbreak of Covid-19
Despite the considerable impact thrust upon the global economy by Covid-19 in the first quarter of 2020, some equity markets have performed very well since they fell by around 25-30%. In fact, after the initial downward movement, some have set record highs. US equities are one such example, with the S&P 500 benefiting from the appreciation in its mega cap tech stocks – which prospered under lockdown restrictions.
It should be noted, however, that the considerable support provided by central banks and governments to tackle the impact of the pandemic has muddied the waters when it comes to valuations and there are differing views on whether some markets may now be overvalued.
Pension default funds are long-term investments that typically invest in a spread of asset classes such as equities, property, bonds and other types of investment. As a result, values can go down as well as up, in response to market movements.
When members are many years away from retirement they will typically be invested more heavily in equity markets and when they draw closer to retirement will typically be invested in a higher proportion of more defensive assets, such as government and investment grade bonds.
Developments in Bond Markets
Given the progress being made with the roll out of vaccines, 2021 has begun with greater economic optimism and inflation is expected to rise. Whilst this may be a temporary increase, and central banks have been playing down the need for increases to interest rates, markets have started to price-in future rate rises.
We have therefore witnessed a notable uptick in bond yields over the first quarter of this year and this has resulted in negative returns for some bond funds. For members invested in annuity-targeted strategies, which typically invest heavily into UK
government bonds, fund values may be more adversely affected than for other retirement strategies. Whilst this may be less of an issue for those wanting to purchase an annuity, it may have a greater impact on those wanting to access their savings differently.
Should any short-term losses materialise, if you’re still some years from retirement, your pension investments should have time to recover.
What if I’m close to my selected retirement age?
Depending on how close to retirement you are, your retirement income needs and your other savings, you might need to take some action. Each individual’s circumstances are different and therefore we would always suggest obtaining regulated financial advice. If you do not have a regulated financial adviser, then you can find one on the Financial Conduct Authority website here.