Aegon LifePath funds are default fund options designed to make pension investing simple. These funds manage the investments from day one through to retirement, automatically and gradually changing how their savings are invested as they get closer to retirement.
How Aegon LifePath funds work
Aegon LifePath funds are target date funds. This means the mix of investments changes automatically as an investor moves through their working life and closer to their target retirement age.
The funds manage long-term environmental, social and governance (ESG) risks and opportunities with the use of exclusionary screening (reducing exposure to certain investments) and tilts (favouring companies with stronger ESG credentials) where possible. Learn more about our approach to Responsible investing.
There are three key stages to how an Aegon Lifepath fund invests:
Growth stage
Savings are fully invested in growth-focused investments, including equities (company shares) and private markets (private businesses or projects). These aim to help grow savings over the long term.
Approaching retirement
15 years before an investor reaches target retirement age, the fund starts to move savings into other types of investments, which may include bonds, protected equities and, from 2027, multi-asset credit. This is to help manage risk and to prepare savings for when an investor is ready to take a retirement income.
At retirement
The investment mix at an investor's target retirement age will differ depending on which Aegon LifePath fund they are invested in. This determines whether it will align with the option to drawdown, purchase an annuity or take savings in cash.
The value of investments may go down as well as up and isn't guaranteed. Your client may get back less than they invested. Please see fund factsheets for full details, including fund-specific risks.
| If, at retirement, an investor intends to... | Option |
|---|---|
| Stay invested through retirement and take money when they need it (drawdown) | Aegon LifePath Flexi |
| Use their pension savings to buy a guaranteed income (annuity) | Aegon LifePath Retirement |
| Take their pension savings as a cash lump sum (cash) | Aegon Lifepath Capital |
Flexible investment options
Aegon LifePath Flexi is the in-house default investment option for TargetPlan and Aegon Master Trust schemes. TargetPlan schemes can use the Retirement or Cash options as their scheme default fund if this better meets the needs of their workforce.
Whatever default option is selected, investors remain in control of their pension savings. They can choose from any of the Aegon LifePath funds and switch investments at any time if their needs or retirement plans change.
Changes we're making between 2026 and 2030
We’re making some changes to the investment mix for Aegon LifePath funds. These changes are designed to give pension savings more opportunities to grow and to spread savings across a wider range of investments to help manage market ups and downs better. From 2026 to 2030, we'll gradually increase investment in private markets and protected equities and introduce a new type of investment, multi-asset credit.
Read more about what’s changing and what it means in our fund update.
Aegon LifePath Flexi
- Designed for people who want to stay invested through retirement and take money when they need it.
- At target retirement age, savings stay invested in a broad mix of investments to support continued growth through retirement
Need to know: For people who stay invested throughout retirement, savings may continue to grow, but investment values can also fall. This means there's a risk that retirement savings could be depleted sooner than planned.
This chart shows how Aegon LifePath Flexi invests at different stages of the retirement journey:
Aegon LifePath Retirement
- Designed for people who plan to buy an annuity when they retire, providing a guaranteed income for life or for a set period.
- At target retirement age, savings will be invested 75% fixed income and 25% cash (to cater for the tax-free cash allowance).
Need to know: An annuity provides a guaranteed income in retirement, but it may offer less flexibility and a lower income than drawdown. Any remaining pension savings typically can't be left to beneficiaries. The investment mix at retirement isn't designed for long-term investing, so members who keep their savings invested may see their fund lose value in real terms because of inflation.
This chart shows how Aegon LifePath Retirement invests at different stages of the retirement journey:
Aegon LifePath Capital
- Designed for people who plan to take all of their pension savings as cash at retirement.
- At target retirement age, savings will be invested 100% cash until withdrawn.
Need to know: People who take their pension savings as cash can usually take up to 25% tax-free. Any amount above this is normally subject to income tax. This information is based on our understanding of current taxation law and HMRC practice, which may change. The investment mix at retirement isn't designed for long-term investing, so members who keep their savings invested may see their fund lose value in real terms because of inflation.
This chart shows how Aegon LifePath Capital invests at different stages of the retirement journey:
Find out more
Explore how Aegon LifePath can support your workplace pension scheme and discover the wider solutions available..
