Pension provider Zurich has introduced a range of new ‘target-date’ fund options in direct response to the new retirement reforms coming in from April.
Zurich said that customers will be able to select from 12 new funds, each designed with a specific investment objective and a range of retirement dates in mind. Ahead of the planned retirement, the funds shift asset allocation to reduce risk in the portfolio.
The new funds include ‘lump sum’ funds, designed for customers who want to take their fund as cash when they retire, annuity funds designed for customers who want to purchase an annuity at retirement, and drawdown funds.
These latter would provide drawdown by investing clients into the Schroders Flexible Retirement fund.
The core funds, managed by Threadneedle on behalf of Zurich, are designed to reduce investment risk and protect customers’ savings as they approach retirement. Each fund is initially available for a range of retirement dates from 2017 to 2026.
The firm said it will start writing to customers later this month to highlight the new fund options including information on how to invest and encouraging customers to seek financial advice to help them make informed decisions about their retirement.
Gareth Jenkins, head of in-force propositions, at Zurich UK Life said: “We’ve developed these new target date funds working closely with fund manager Threadneedle to help our long standing customers make the most of the new pension freedoms being introduced in April.
“By introducing these new funds we’re using our expertise to help customers manage their investment risk so they can meet their retirement income objectives – whether buying an annuity, taking flexi-access drawdown or taking cash.”
“We hope that these enhancements to our retirement proposition will empower customers and advisers and help them make the right decisions now to secure their financial futures for the longer term.”