The Lifeplan is an option which allows the Trustee to manage your investment choices for you throughout your membership so you are invested in the right investment option for you at different stages of your life. If you have been auto enrolled, you will be invested in the Lifeplan automatically.
The Lifeplan is based on your Target Retirement Date, the date on which you plan to access your pension savings. You can set your own Target Retirement Date or the Trustee will use your State Pension Age.
Younger members can afford to take more risk as retirement is a long way off so the Lifeplan starts off in the Growth option. It will then move your funds through the Moderate and Cautious options and into Retirement Planning when you get close to retirement. In the last year before your Target Retirement Date, 25% of your fund is moved to the Cash option to provide your tax free cash at retirement.
Where you start will depend on how far from your Target Retirement Date you are. For example, if you are 35 years from retirement when you join, your contributions will be invested in the Growth option to start with. If you are 20 years from retirement, then you will start in the Moderate option.
The target return depends which option you are invested in. The target returns range from inflation1 plus 4.5%-1.15% each year. The target returns are expected to fall as you approach your Target Retirement Date as the level of risk reduces. The Trustee aims to provide stable returns over the long term. The underlying investments in each fund are reviewed monthly by the Trustee and changes made if necessary based on market conditions.
Choosing the Cheviot Lifeplan means that the Trustee will look after your investments for you and will make changes on your behalf if necessary.
1 Consumer price index
Please note - funds not showing 5 year figures have an inception date of less than 5 years ago.
Inception dates for the funds are as follows:
Your Target Retirement Date is the date when you plan to start to access your pensions savings (it does not need to be the same as your Normal Retirement Date or the date you stop working). The Cheviot Lifeplan uses this date to transition you through the investment options. So it is important to update us if your Target Retirement Date changes.
The Government has introduced changes to allow you to take your retirement benefits differently (click here for more information). Our investment options take these changes into account. The lifestyling process can continue beyond your Target Retirement Date. Under the Lifeplan, your fund will remain invested in the Retirement Planning option which is designed to protect your funds against inflation, for as long as you choose. We will keep the choices under review and change them if necessary in the future.
You can take your 25% tax free sum at retirement from the Cash option and leave the remainder of your fund invested in the Retirement Planning option or the investment option of your choice. You can then draw down cash over a period of years (through Cheviot's flexi access option) or buy a secure income from another provider, called an annuity.
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