Investment pathways

For financial advisers only

The FCA published policy statement PS19/21 in January 2019, to recognise the growing market of drawdown customers. 

To comply with phase three regulations providers will need to:

  • present non-advised customers accessing drawdown with four investment pathway fund options based on four key objectives;
  • issue warnings to customers making an active choice to invest wholly or predominantly in cash along with regular warnings regarding cash holdings, and
  • provide decumulation customers with costs and charges information on an annual basis. This includes customers in drawdown or who have made at least one UFPLS payment.

These changes will be introduced from 1 February 2021.

Although the pathways are designed for non-advised customers, the FCA have said that advisers will have to consider pathway solutions when making their recommendation about which investment strategy is appropriate.

Investment pathway funds are investment solutions offered to help non advised customers to match a particular objective in drawdown. This is part of the new process introduced by the FCA to help non-advised customers make better investment decisions.

All pathway funds will be available to select from 1 February 2021. How you choose funds for your client on our systems isn’t changing.

Our aim has been to take a balanced approach to investment choices and we won’t promote one investment option over another.  For our non-advised customers, we're adding additional information to Your Retirement Planner, along with FAQs. We’ve also updated the offer packs provided by assist to include a comprehensive overview of investment pathways.

As instructed by the FCA, we’ll write out to all non-advised customers invested either predominately or entirely in cash to outline the potential implications of this due to inflation. We’ll also include this warning in their annual statement if they remain invested predominately or entirely in cash.

We’ll include information on costs and charges in the customer’s annual statement.