Legal and General Investment Management’s suite of pre-retirement funds has broken the £1bn barrier on the back of ongoing strong asset growth, the firm has said.
The firm’s first pre-retirement fund was first launched in November 2003. Ten years later in November 2013, it introduced the Pre-retirement Inflation Linked fund, followed by the Pre-retirement Inflation Sensitive fund in April 2014.
The two latter funds were “designed to give UK defined contribution pension investors some protection against inflation in the run-up to retirement”.
The firm claimed that the funds had continued to see inflows despite the recent changes announced at the Budget, which it said showed that “trustees still want a pre-retirement default option that is focused on low risk income generation, including the potential use of annuities”.
The firm said in a note: “Lgim’s suite of pre-retirement funds has been well received amongst the UK investment community and Lgim has been awarded ‘preferred provider’ status by a number of consultants.”
Marcus Mollan, head of strategic investment and risk management at Lgim, said: “The growth in Lgim’s PRF suite has continued in the wake of recent UK budget changes, which did away with the obligation on pensioners to buy an annuity upon retirement.
“Despite these changes, many trustees still want a pre-retirement default option that is focused on low risk income generation, including the potential use of annuities.
“Consequently, we are confident that the funds will continue to prove popular with investors in the future and that we will continue to experience significant in-flows.”
