Standard Life Fund

Cameron1590_2

Hello,

I have recently moved over to being a contractor and my payroll provider has set up a private pension with standard life for me. 

I’m fairly young and well know very little about private pension funds having always had a government pension. 

My money is being invested in standard life’s  Sustainable Multi Asset Universal (AP 10 Year) SLP (a lifestyle profile).

Essentially, I’m open to some volatility but want a well performing fund (don’t we all) that will reduce in volatility as I get older and closer to retirement. 

I’ve done lots of googling and well it all comes out a double Dutch to me. 

Any suggestions on whether this is a suitable fund for me? I’m 28 and currently paying in £2,500 per month in a hope I can retire early (55) and have a comfortable lifestyle. 

Thanks,

JohnWinder

Hollow's book 'How to fund the life you want'; get it from your library. If it doesn't quite do it for you, get Hale's book 'Smarter Investing'. The double Dutch will dissolve, leaving you with the essence of understanding. You've got plenty of time, good luck.

dunstonh

Essentially, I’m open to some volatility but want a well performing fund (don’t we all) that will reduce in volatility as I get older and closer to retirement. 

Be careful what you wish for.    People with lifestyling risk reduction have suffered badly over the last 18 months.    Unless you intend to spend your whole pension fund in one go on your day of retirement, you probably don't need that scale of risk reduction.

JohnWinder

Good point, but (s)he said he's 28 (presumably years old). How soon with the fund start to de-risk for the investor's age?

Rich1976

I’m also in that fund and the de-risking starts about 10 years before the set pension age eg 67. Fortunately it doesn’t de-risk as drastically as some other providers to start with but in the last 3 years the equity portion is about 30 to 40% if I recall from the fact sheets. 

Albermarle

Rich1976 said:

I’m also in that fund and the de-risking starts about 10 years before the set pension age eg 67. Fortunately it doesn’t de-risk as drastically as some other providers to start with but in the last 3 years the equity portion is about 30 to 40% if I recall from the fact sheets. 

You can also change your projected retirement age in their system to up to 75.

It sounds like a lifestyle fund geared to drawdown, although many on here would say that equity % is still a bit low even in retirement . The big issue has been people in lifestyle funds geared to taking an annuity, when they were planning to use drawdown. So they got hit badly by the huge drop in bond/gilts values in last year and continuing in 2023.

Albermarle

My money is being invested in standard life’s  Sustainable Multi Asset Universal (AP 10 Year) SLP (a lifestyle profile).

As far as I can see at the moment you will be fully invested in this fund.

LPNL.pdf (standardlife.com)

At about 80% equities it is typical of a growth orientated UK pension fund.

Some on this forum will say you should be at 100% equities and they will be looking in 'horror' at the 1% charge. However normally there will be an employer discount with SL. 

engagedandopen

As Albermarle said, you might want to consider 100% equities at your age.   You could also look at Sustainable Focus 5 (currently 85% equity) if it's available to you, and then switch down to the lower Sustainable Focus funds as you get closer to retirement.

Cameron1590_2

Hi all,

As always, blown away with the replies and help. Thank you. 

Yes, the annual charge is discounted. I pay 0.255% per annum at the moment. 

It sounds like I need to spend some time reading the various fact sheets for the funds available and decide which I want to invest in. 

Thanks

Albermarle

Cameron1590_2 said:

Hi all,

As always, blown away with the replies and help. Thank you. 

Yes, the annual charge is discounted. I pay 0.255% per annum at the moment. 

It sounds like I need to spend some time reading the various fact sheets for the funds available and decide which I want to invest in. 

Thanks

That is quite a  a low charge considering it will be 'all in' including platform and fund charges.
You have  to consider.
Do you want to be in a Lifestyle fund, that will derisk as you get nearer retirement? As far as I can see this will mean you are 'stuck' with the growth fund I linked for the next many years.
 If you want to be in a different fund(s), then you will have to come out of the lifestyle option altogether and just pick which fund(s) you want from what SL offer.

LHW99

Also over 30+ years, a few years of prices going nowhere (or even dropping) will not hurt, as the number of units in the fund you buy will be greater than if the unit price was going up massively.

Ideally you want the unit price to stay the same for 20 years and then soar 500%+ in the last 10 - won't happen, but the units you buy now will almost certainly be worth much more by the time you come to retire.

Volatility is not necessarily bad over a long timescale, as long as you hold your nerve.