From 31 March 2023, we’re updating the fund objective for the following funds:
- Scottish Equitable Legal & General Pre-Retirement fund (available across our insured Pension and Aegon Retirement Choices (ARC) fund ranges).
- Aegon LGIM Pre-Retirement (BLK) fund (available as part of our TargetPlan fund range).
A fund objective describes what the fund aims to achieve for investors.
We’re also updating the fund benchmark for the Aegon LGIM Pre-Retirement (BLK) fund.
Fund managers use benchmarks as a way of measuring a fund’s performance against a similar market or region.
Nothing else about the funds is changing at this time.
The changes in more detail
Objective changes
The underlying fund manager, Legal & General Investment Management Limited (LGIM), has updated the fund objective of the underlying fund to include Environmental, Social and Governance (ESG) considerations as part of the investment strategy.
To make sure our versions of the fund match the underlying, we’re updating them. Details in the table below:
Scottish Equitable Legal & General Pre-Retirement fund
| Existing fund objective | New fund objective |
|---|---|
| This fund aims to provide diversified exposure to assets that reflect the investments underlying a typical annuity product. The fund invests in LGIM’s index-tracking bond funds to gain exposure to these assets. | This fund aims to provide diversified exposure to fixed interest assets, incorporating Environmental, Social and Governance (“ESG”) considerations as part of the investment strategy, that reflect the investments underlying a typical annuity product. The fund, however, cannot provide full protection against changes in annuity rates for individual members since these also depend upon a number of other factors (for example changes to mortality assumptions). |
Source: Aegon UK
Aegon LGIM Pre-Retirement (BLK) fund
| Existing fund objective | New fund objective |
|---|---|
| The fund aims to provide diversified exposure to assets that reflect the investments underlying a typical traditional level annuity product. | This fund aims to provide diversified exposure to fixed interest assets, incorporating Environmental, Social and Governance (“ESG”) considerations as part of the investment strategy, that reflect the investments underlying a typical annuity product. The fund, however, cannot provide full protection against changes in annuity rates for individual members since these also depend upon a number of other factors (for example changes to mortality assumptions). |
Source: Aegon UK
There’s no guarantee the funds will meet their objectives. The value of an investment can fall as well as rise and isn’t guaranteed. Investors could get back less than has been paid in.
Benchmark change
The underlying fund manager has updated the underlying fund benchmark to help it measure the fund’s performance. A ‘composite’ benchmark is made up of more than one index or market.
To make sure the Aegon LGIM Pre-Retirement (BLK) fund matches the underlying fund, we’re updating it. Details can be found below:
Old fund benchmark
- Composite benchmark (constructed internally by the underlying fund manager)
New fund benchmark
- Composite benchmark (made up of):
- 52.5% FTSE UK Level Adjusted Annuity Index Single Life – Standard Retirement
- 30.0% FTSE UK Level Adjusted Annuity Index Joint Life – Early Retirement
- 17.5% FTSE UK Level Adjusted Annuity Index Single Life – Early Retirement)
Source: Aegon UK
What this means for you
We’ll update our literature and our website as soon as we can, but you may notice the old and new information in use for a time.
You can find more information on these funds and view the fund factsheets via the ‘Fund prices and performance page’ and selecting either ‘Other fund ranges’ ‘Aegon Retirement Choices’ or ‘TargetPlan funds’.
What current investors need to do
Existing investors don’t need to do anything. Please speak to a financial adviser if you’re not sure about what these changes mean for you. If you don’t have a financial adviser, you can visit moneyhelper.org.uk/choosing-a-financial-adviser to find the right one for you.