Our approach to Defined Contribution

An innovative and flexible solution to retirement investment.

Optimal decumulation strategies

Understanding your goals

Retirees with Defined Contribution (DC) pension schemes have many different goals for their retirement savings.These could include one or more of the following:

 

  • Receive a steady income
  • Maximise spending during retirement
  • Avoid savings running out
  • Invest for good by incorporating responsible investment preferences
  • Leave inheritance for descendants

 

Our flexible DC investment solutions allow you to offer your members strategies that aim to meet all their investment goals.

Understanding your goals

pension-funds-defined-contribution-retirees

Personalised retirement journeys

Each retirement journey is built around two primary goals:

The main savings or “accumulation” phase of the retirement journey is pre-retirement.

During this period, regular pension contributions or one-off payments are made into the savings pot to allow for capital growth.

The pot is invested into different retirement building blocks, according to each member’s risk profile, constraints and retirement objective.

A member may choose to receive an income at different stages of their retirement journey. They may wish to:

  • withdraw all their savings on retirement
  • receive regular payments throughout their life-time (through purchasing a life annuity)
  • or continue to invest savings in the financial markets and be able to draw on savings at any time.

Different approaches can be taken to allow for capital growth, while also enabling distributions to be paid in the pre-retirement phase and/or gradual decumulation post-retirement.  

How do these goals translate into an investment strategy?

 

Pension Funds/Defined-contribution-Allowing a flexible approach to the retirement journey

A dedicated glidepath for every participant

Your simple approach to retirement planning

Through our efficient retirement framework, any retirement journey goal can be achieved simply by combining allocations to our growth and distribution building blocks, in line with the targeted objectives.

End of career example

Pension funds: defined-contribution-end-of-career

Personal goal: Generating Retirement Income

 

 

Heng, 50, is an ENT surgeon, has an adult child and lives in Singapore

 

Aged 50, Heng will retire in fifteen years. He has a comfortable income, as his seniority continues to add on to his wages.

He has already saved for his retirement so he can enjoy it fully when the time comes.

 

  • Lump sum contribution: 300 000 SGD
  • Periodic contribution over 15 years: 5 000 SGD/month
  • Planned distribution in 15 years: 10 000 SGD/month
  • Cumulated investments: 1 200 000 SGD

Maximise income generated for retirement phase

 

Strategy to meet objectives: gradual transition, derisking from growth to distribution

 

  • First 10 years: 100% growth investments
  • Transition: 5 years of gradual transition into the distribution fund
  • Post-retirement: The distribution fund will be used to meet the desired retirement income.

Defined contribution solutions: End of career – Generating Retirement Income

At-retirement example

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Personal goal: planning for multiple objectives

 

 

Michelle, 66, married and mother of two grown-up children, is now retired and lives in Singapore.

 

Michelle has some money to invest and wishes to receive a regular monthly income.

She wants to maintain a comfortable standard of living, but also to put something aside as inheritance for her children and grandchildren.

 

  • Lump sum contribution: 300 000 SGD
  • Planned distribution in 15 years: 1 200 SGD/month
  • Cumulated investments: 300 000 SGD

Generate income for retirement and grow assets for her heirs

 

Strategy to meet objectives: a retirement plan that balances income and growth

 

Post-retirement for the next 15 years:

  •  60% investment in decumulation strategy (for her)
  • 40% in growth strategy (for her heirs)

Defined contribution solutions: At-retirement – Planning for multiple goals

No more “one-size-fits-all”

Tailored retirement solutions to meet your members' unique goals

 

 

We recognise your members are individuals who each have unique aims and objectives for their retirement.

 

Our flexible and innovative approach to retirement planning offers a simple and efficient way to achieve multiple, and sometimes conflicting, objectives at a scheme-wide level.

 

We can help your pension fund construct a defined contribution scheme that considers all your members’ individual goals.

No more “one-size-fits-all”

Pension Funds/Defined contribution - We recognise your members are individuals who each have unique aims and objectives for their retirement.

Our key differentiators

Pre-defined glidepaths


More customised to individual need.

Risk-profiled retirement portfolios


Based on real-life retirement goals1, these are more relevant, easier to understand and can be adjusted over time.

1. According to risk-profile or asset allocation preference

Interested in learning more about how we can work together?

Read more about the challenges of defining
a correct decumulation strategy

Discover our range of strategies for pension funds

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