As members get closer to retirement (within 10 years), the Aegon BlackRock LifePath Flexi fund gradually moves into what are generally considered to be lower-risk investments. These lower-risk investments could include government and corporate bonds, which are loans to governments and companies from the UK and overseas.
The LifePath Flexi fund moves into lower-risk investments until it reaches approximately 40% in global equities and 60% in bonds (also known as fixed income securities) at a member’s target retirement age. Around 45%¹ at this stage will be invested in funds incorporating ESG screens.
It will maintain the same 40%/60% mix into retirement, and it assumes members will want to remain invested and drawdown an income from their savings. This mix provides a balance between risk and potential returns that can help guard against the effects of inflation, as well as supporting income withdrawals, although there’s no guarantee.
The value of members’ savings and any income isn’t guaranteed and may fall as well as rise in value. They could run out of money. Moving into lower-risk investments could also mean they miss out on some growth if markets go up.
How the Aegon BlackRock LifePath Flexi changes as members approach retirement