St James's PlaceSep 16 2020

SJP looks to 'decade of retirement' with new funds

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SJP looks to 'decade of retirement' with new funds
Credit: Joe Giddens

St James’s Place's new fund range, designed to provide regular income to clients in retirement, is to launch next week as the advice firm looks to capitalise on the “decade of retirement”.

The national wealth manager announced today (September 16) it will launch the trio of funds next Monday (September 23).

SJP’s director of investment management, Rob Gardner, previously told FTAdviser the firm was planning to launch the range to service its main client demographic — 55 to 58 year olds — as they reached the decumulation phase and their wealth needed to be transferred to income.

The firm described the next decade as the “decade of retirement”, as the ‘baby boomer’ generation retires and ensuring a sustainable income for that demographic becomes a key challenge for wealth management.

SJP said its new ‘InRetirement funds’ would be highly liquid with a total return focus, designed for investors who are looking to achieve a regular income through withdrawals from their investment pots.

Each fund is designed to cater to a different client goal: the Prudence InRetirement fund has the least investment risk and is suitable for clients who only have some capacity for loss; the Growth InRetirement fund has the most investment risk; and the Balance Retirement fund sits between the two.

Mr Gardner said: “It’s amazing to consider that every day in the UK some 2,000 people will celebrate their 65th birthday. They have spent the past forty years in the workplace, earning a salary and – hopefully – saving towards their retirement.

“The question is: how do they turn their retirement savings into an income stream that lasts as long as they live? But not only that, how does that income keep pace with inflation? A comfortable income today may not be enough in ten, twenty or thirty years’ time.

“The challenge, the decumulation challenge as we call it in the industry, is simply solving the problem of turning your retirement savings into a lifetime income stream.”

The funds will be managed by State Street Global Advisors, whose responsibilities will include ongoing rebalancing of the underlying funds, cash flow management and currency hedging.

Dan Farley, chief investment officer at State Street Global Advisors, said increased longevity and the rise of multi-stage lives had put a focus on the need for “well-designed, post-retirement solutions”.

He added: “We have worked with SJP to develop the InRetirement range, a unique proposition designed to balance investors’ needs between growth, capital protection and reliable income, while offering them simplicity and flexibility. 

“We believe that this approach will help investors cut through the complexity of investing in retirement.”