Standard Life Pension

magd36

Anyone any ideas on best investments for a standard life pension in drawdown? Don’t really want to transfer as it’s free to enter drawdown and charges are discounted (as it’s a group pension). Not one for taking significant risks.

tetrarch

I was with SL until very recently. "Discounted" does not necessarily mean "good value".

Personally, the returns on the SL funds do not warrant the extra charges they levy

My fund charges were discounted but from a high base - I'm in the process of moving all my pensions into ii as it appears to be best value.

That does leave me with fund choice, but I can live with that

Regards

Tet

PS - SL often do not allow in-specie transfers, so there is the additional out-of-the-market risk that you'll carry with a cash transfer

dunstonh

Anyone any ideas on best investments for a standard life pension in drawdown? 

Which Standard Life pension?   Some of their pensions have just one fund and others have over 30,000 investment options.  Most of their group schemes have around 20-30,000 options depending on type.

What is your definition of best?

magd36

dunstonh said:

Anyone any ideas on best investments for a standard life pension in drawdown? 

Which Standard Life pension?   Some of their pensions have just one fund and others have over 30,000 investment options.  Most of their group schemes have around 20-30,000 options depending on type.

What is your definition of best?

Split into 3 funds:

SL At Retirement Universal (10YearPP)
SL Multi Asset Sustainable PP
SL Sustainable Multi Asset Pre Ret PP 10 Yr

Best would probably be low risk and matching inflation if possible 

magd36

tetrarch said:

I was with SL until very recently. "Discounted" does not necessarily mean "good value".

Personally, the returns on the SL funds do not warrant the extra charges they levy

My fund charges were discounted but from a high base - I'm in the process of moving all my pensions into ii as it appears to be best value.

That does leave me with fund choice, but I can live with that

Regards

Tet

PS - SL often do not allow in-specie transfers, so there is the additional out-of-the-market risk that you'll carry with a cash transfer

It’s the transfer costs and potential advisor charges that makes me wonder if this will be worth it. I currently have an advisor but I’m not that impressed but that’s another story.

Albermarle

magd36 said:

dunstonh said:

Anyone any ideas on best investments for a standard life pension in drawdown? 

Which Standard Life pension?   Some of their pensions have just one fund and others have over 30,000 investment options.  Most of their group schemes have around 20-30,000 options depending on type.

What is your definition of best?

Split into 3 funds:

SL At Retirement Universal (10YearPP)
SL Multi Asset Sustainable PP
SL Sustainable Multi Asset Pre Ret PP 10 Yr

Best would probably be low risk and matching inflation if possible 

Assuming that you would like your drawdown pot to last your full retirement, which could be 30 years (ish) there are some general rules ( simplified below) 
1) Do not withdraw too much each year. Around 4% of the initial pot is the figure often mentioned ( increased with inflation each year).
2) A simple investment mix of equities ( shares) and bonds should be OK. Too low a % of equities could mean inadequate growth, whilst too high could mean a rollercoaster ride. Something around 50;50 is typical.

Do you have access to these?
Investment Pathways | Funds | Standard Life

magd36

Albermarle said:

magd36 said:

dunstonh said:

Anyone any ideas on best investments for a standard life pension in drawdown? 

Which Standard Life pension?   Some of their pensions have just one fund and others have over 30,000 investment options.  Most of their group schemes have around 20-30,000 options depending on type.

What is your definition of best?

Split into 3 funds:

SL At Retirement Universal (10YearPP)
SL Multi Asset Sustainable PP
SL Sustainable Multi Asset Pre Ret PP 10 Yr

Best would probably be low risk and matching inflation if possible 

Assuming that you would like your drawdown pot to last your full retirement, which could be 30 years (ish) there are some general rules ( simplified below) 
1) Do not withdraw too much each year. Around 4% of the initial pot is the figure often mentioned ( increased with inflation each year).
2) A simple investment mix of equities ( shares) and bonds should be OK. Too low a % of equities could mean inadequate growth, whilst too high could mean a rollercoaster ride. Something around 50;50 is typical.

Do you have access to these?
Investment Pathways | Funds | Standard Life

Thanks. Not sure if I have access to the pathways but I’ll ask and look into this. Thanks again 

tetrarch

magd36 said:

tetrarch said:

I was with SL until very recently. "Discounted" does not necessarily mean "good value".

Personally, the returns on the SL funds do not warrant the extra charges they levy

My fund charges were discounted but from a high base - I'm in the process of moving all my pensions into ii as it appears to be best value.

That does leave me with fund choice, but I can live with that

Regards

Tet

PS - SL often do not allow in-specie transfers, so there is the additional out-of-the-market risk that you'll carry with a cash transfer

It’s the transfer costs and potential advisor charges that makes me wonder if this will be worth it. I currently have an advisor but I’m not that impressed but that’s another story.

I didn't pay any fees and I don't have an advisor. I don't know whether I lost a bid/offer spread. Market timing wise I was lucky as the market ticked off whilst I was out of the market, plus ii were paying a bonus on the transfer as well

Regards

Tet

Moonwolf

I think fund choices depend on your attitude to risk and what other pension provision you have.

Whether it is good value depends on the discount level as well, which is different for different funds.

My Standard Life is an ex BT with 0.72% points discount on SL funds, less on others.

My total charges are 0.288% which are beatable but not ridiculous and I’m comfortable with where I am.

I have a lot of DB cover so have highish risk, but I am drawing more at the moment as I have retired early so am waiting for my DB pensions and have considered that.

My funds are

SL Blackrock ACS World ex UK Equity Tracker 40%
SL Blackrock ACS 50:50 Global Equity Tracker 35%
SL Sustainable Multi-Asset pre ret 10%
Standard Life Money Market Pension Fund 15%

The logic is, global tracking for growth with extra UK cover as a hedge against currency swings. The money market and pre-retirement I switched to from high risk managed funds when I retired and are there to be less volatile and cover a few years drawdown if there is a big market correction. I will reduce this as my DB pensions kick in.

Once DB and state pensions are all in payment I will have more than enough for the basics so what is left is for the cream so I don’t need to be overly anxious.

Edit: I ‘m braced to be told how unsophisticated this strategy is, and I should be doing something with bonds etc, however I do like simple.

magd36

Moonwolf said:

I think fund choices depend on your attitude to risk and what other pension provision you have.

Whether it is good value depends on the discount level as well, which is different for different funds.

My Standard Life is an ex BT with 0.72% points discount on SL funds, less on others.

My total charges are 0.288% which are beatable but not ridiculous and I’m comfortable with where I am.

I have a lot of DB cover so have highish risk, but I am drawing more at the moment as I have retired early so am waiting for my DB pensions and have considered that.

My funds are

SL Blackrock ACS World ex UK Equity Tracker 40%
SL Blackrock ACS 50:50 Global Equity Tracker 35%
SL Sustainable Multi-Asset pre ret 10%
Standard Life Money Market Pension Fund 15%

The logic is, global tracking for growth with extra UK cover as a hedge against currency swings. The money market and pre-retirement I switched to from high risk managed funds when I retired and are there to be less volatile and cover a few years drawdown if there is a big market correction. I will reduce this as my DB pensions kick in.

Once DB and state pensions are all in payment I will have more than enough for the basics so what is left is for the cream so I don’t need to be overly anxious.

Edit: I ‘m braced to be told how unsophisticated this strategy is, and I should be doing something with bonds etc, however I do like simple.

That’s interesting. Might make a similar plan as my situation is broadly similar. It’s good to see other people’s ideas.

Albermarle

It also depends on what assets you have outside the pension.
For example if you have large cash savings, it makes sense to take more risk ( higher equity % ) with your pension investments)