Aegon has launched a new fund for pension customers, Retiready Stability, on its Retiready digital service, bolstering the range of investments available to the platform’s 75,000 digital pensions customers.
The fund, which slots into risk ‘level 1’ means pension investors now have a choice of five funds, one for every risk level.
Aegon claimed it is very low risk and designed for investors seeking to preserve their pension savings, typically before taking retirement income, and still receive bank deposit beating returns over the medium term.
A total of 60 per cent of UK investors said that they do not want to take risk with their money, according to a Blackrock Investor Pulse from August 2014.
Aegon said that with cash investments offering poor returns, there’s a good chance that these investors could lose money in real terms over time.
It added that the stability fund isn’t a substitute for cash, but the firm believes is strikes an appropriate balance between minimising risk and offering potential for beating cash returns.
The firm said that the financial crisis and the low interest rate environment that followed have significantly changed peoples appetite for risk.
Alongside this, new research from Aegon suggests that one in three - 32 per cent of people - over 55 are now more risk averse as a result of the crash and are approaching investment with this in mind.
The research was conducted by OnePoll in July 2015 amongst 2,000 people over the age of 55.
Growth ambitions in this age group are also conservative despite record low interest rates, with 40 per cent investing in products that keep pace with or slightly beat inflation.
Nick Dixon, investment director at Aegon said: “Many pension savers approaching retirement do not want to lose money. Retiready’s Stability fund is designed to minimise market losses while retaining potential for growth above inflation.
“We also know that too much choice can be paralysing, which is why we’ve developed a straightforward risk assessment tool to help people understand how much risk they are willing to take and five easy options to choose from.”
ruth.gillbe@ft.com