LifePlan
How it works
Ready-made investment plans to pick from
LifePlan gives you investment options based on how and when you plan to use your savings.
It gives your savings the opportunity to grow and switches your investments to get them ready for when you retire.
Most members are in LifePlan. LifePlan may be suitable for you if you want a ready-made investment strategy where you don't need to choose funds yourself.
Watch our video to find out more about investing with LifePlan.
Pension Investments - LifePlan
When you save into your pension, your savings are invested to help them grow.
You can invest your savings in two ways.
If you feel confident enough to manage your own investments, you can choose PersonalChoice. But if you’d prefer a ready-made investment option, you might want to choose LifePlan instead.
LifePlan manages your investments for you. It moves your money between different investment funds based on how and when you want to use your savings.
When you’re further away from retirement, LifePlan invests in ways that will help your money grow. And as you get closer to retirement, LifePlan changes your investments to get your money ready for you to take.
Each LifePlan option invests your money in the same way until 10 years before your Target Retirement Age. This is the age you plan to start taking your money. During these last 10 years, the way your money is invested will depend on the option you’ve chosen.
You can choose from three LifePlan options, depending on how you want to take your savings when you retire:
If you want to take all your savings as cash, choose the Cash Focus LifePlan.
If you want to use your savings to buy an income for life (called an annuity) choose the Annuity Income Focus LifePlan.
And if you want to leave some of your money invested after retirement, or if you’re not sure how you want to take your savings, choose the Flexible Income Focus LifePlan.
You also need to select a Target Retirement Age, so that your LifePlan option can start to change your investments at the right time.
When you first start saving, an initial Target Retirement Age and LifePlan option will be set for you. It’s your responsibility to check whether they’re right for you and to decide whether you want to choose something else.
You should start thinking about them now.
But if your Target Retirement Age is more than 10 years away, and you don’t know how you want to take your savings yet, it’s ok to wait before you make a change.
You can change your LifePlan option and Target Retirement Age by logging into ‘Your Pension’ at any time. If you’re in the Scottish Widows Retirement Benefits Scheme, you’ll need to contact your administrator instead.
You should check on your pension to see how it’s performing. But remember, a pension is a long-term investment. Its value will go up and down over time. But what matters is how they grow in the long term. If you’re not sure what to do, consider taking independent financial advice.
There are some things you need to do to make the most of LifePlan:
Choose how you plan to use your savings
There are three options within LifePlan. Initially, all three options aim to grow your savings in the same way. Then, 10 years before you retire, the three options differ in how they get your savings ready for you to use.
You need to decide how and when you plan to use your savings when you retire (subject to certain restrictions) as this will change the way your money is invested. Find out how the three LifePlan options work.
If you don’t know how you want to take your money, it's okay. All three options grow your money in the same way until 10 years before you retire, so you can wait until that point to choose how you plan to use your savings if you want to. And even after that point, you can make a change if your plans change.
The closer you can align your choice to how you plan to use your savings, the better your savings can work for you.
Set your target retirement age
LifePlan invests your savings in the same way until you’re 10 years from your target retirement age. So if you set your target retirement age earlier, your investments will begin to switch earlier too. If you set a later target retirement date, your investments will switch later.
You can set your target retirement age on Your Pension - and change it any time you like. It’s what LifePlan uses to work out when to move your investments. It doesn't mean you have to take your pension savings at that age.
It's a good idea to review your target retirement age and update it if your plans change.
If you don’t set a target retirement age, we’ll assume you want to use the default retirement age for your Scheme, which for most members will be 65. LifePlan will get your savings ready for then. You can see what your default retirement age is on Your Pension.
Remember, pensions are a long-term investment and the value of investments go up and down. Some volatility is to be expected from time to time.
Your three options
These LifePlan options are new from July 2021
All three options grow your savings in the same way until you’re 10 years from your target retirement date. Then, the three options differ in how they get your savings ready for you to use at retirement.
Your three options are:
- Flexible Income Focus – If you want a flexible income which invests your savings whilst you take an income from them as and when you need it. It’s also for members who plan to use their savings in a variety of ways (for example, a mix of flexible income, regular guaranteed income and cash).
- Annuity Income Focus – If you want to turn your savings into a guaranteed income by buying an annuity.
- Cash Focus – If you want to take your savings as a cash lump sum.
Choosing a LifePlan option does not mean you have to use your money that way when you retire. But it’s important to set a retirement age and choose the option that matches what you think you’ll do, even if that changes later. If you do not, you might expose your money to more risk than you need or miss out on potential growth.
How each option invests your savings
All three options aim to grow your savings in the same way
They do this by investing in the Global Equity Fund to begin with – when you're over 30 years away from your retirement age.
All three options start to consolidate that growth in the same way
When you're 30 years from your retirement age, LifePlan starts to switch your savings out of the Global Equity Fund and into the Mixed Investment Fund. This aims to keep growing your savings, but with slightly less risk. This gradual switch happens over 10 years. So by the time you're 20 years from your retirement age, you're wholly invested in the Mixed Investment Fund.
The three options only differ in how they get your savings ready for you to use
10 years from your retirement age, LifePlan starts to switch your savings again. How it is invested when you reach your retirement age depends on which of the three LifePlan options your savings are invested in:
| Flexible Income Focus | Annuity Income Focus | Cash Focus |
| More than 30 years to your retirement age | ||
| Global Equity Fund | Global Equity Fund | Global Equity Fund |
| 30 - 20 years to your retirement age | ||
| Global Equity Fund, gradually moving to the Mixed Investment Fund over 10 years | Global Equity Fund, gradually moving to the Mixed Investment Fund over 10 years | Global Equity Fund, gradually moving to the Mixed Investment Fund over 10 years |
| 20 - 10 years to your retirement age | ||
| Mixed Investment Fund | Mixed Investment Fund | Mixed Investment Fund |
| 10 - 3 years to your retirement age | ||
| Mixed Investment Fund, some of which gradually moves into the Annuity Bond fund | Mixed Investment Fund, most of which gradually moves into the Annuity Bond fund | Mixed Investment Fund |
| 3 - 0 years to your retirement age | ||
| Starts to move some savings into the Cash Fund | Starts to move some savings into the Cash Fund | Starts to move most savings into the Cash Fund |
| 0 years (you've reached your retirement age) Your savings are invested in a mix of: | ||
| Mixed Investment Fund | ||
| 45% | 20% | 30% |
| Annuity Bond Fund | ||
| 35% | 65% | - |
| Cash Fund | ||
| 20% | 15% | 70% |
How your savings are invested with Flexible Income Focus
Global Equity Fund
Annuity Bond Fund
35% of your savings at retirement
Mixed Investment Fund
45% of your savings at retirement
Cash Fund
20% of your savings at retirement
How your savings are invested with Annuity Income Focus
Global Equity Fund
Annuity Bond Fund
65% of your savings at retirement
Mixed Investment Fund
20% of your savings at retirement
Cash Fund
15% of your savings at retirement
How your savings are invested with Cash Focus
Global Equity Fund
Mixed Investment Fund
30% of your savings at retirement
Cash Fund
70% of your savings at retirement
To find out how each of the individual funds work, visit the investment funds page.
Fund factsheets and information
For more information about our funds, including fund factsheets, charges, past performance and unit price history, see the fund investment information section.
Fund charges are measured by the Total Expense Ratio (TER). The TER is the cost of running the fund expressed as a percentage of the fund’s value. The TER includes investment management fees (which are usually a fixed percentage), plus trading, legal and other costs incurred in managing the fund which can vary over time.
For details of the current TERs, see the fund factsheets in the fund investment information section.
The Trustee reserves the right to vary charges or introduce additional charges without prior notice to you, but if it does so, it will always aim to notify you as soon as possible.
Fund unit prices
Your contributions are invested each month into funds. Each fund is divided into 'units' and each unit has a value (the unit price). Your invested contributions buy units in these funds and every time you pay a contribution into the fund you're allocated more units. The number of units bought with your contributions depends on the unit price on the day when your contributions are invested.
Each fund has one unit price each day, whether you are buying or selling units, however, most of the underlying assets have a different buying and selling price. The fund’s single unit price can therefore be based on either the buying or selling price of the underlying assets in the fund, depending on whether the fund has to buy or sell more assets that day. This ensures that investors joining or leaving the fund pay or receive a fair price for their investments and are not subsidised at the expense of other investors in the fund.
The benchmark and the manager’s own stated performance figures are based on the mid-price (the average of the buying and selling price) and therefore do not take into account the difference between the buying and selling price that is reflected in the fund’s unit price.
The Trustee regularly reviews the performance of all funds. After consulting with its advisers, the Trustee may change the funds or investment managers at any time if it believes there is good reason to do so, for example, if it is expected to improve investment performance or help the funds to achieve their objectives. The benchmarks or fund charges may also change from time to time. Current information will always be available on the Scheme website. The Trustee will tell you about all important changes to the funds, their objectives or charges.
IMPORTANT INFORMATION IF YOU LIVE OR HAVE LIVED IN THE ISLE OF MAN OR THE CHANNEL ISLANDS:
If you built up any pension savings while living in the Isle of Man or in the Channel Islands, local tax rules mean that some of the options available to you at retirement may be different. For example, you cannot usually take all of your account as cash unless it is very low in value and other conditions are met, including age limits and allowing for any amounts taken from other pension arrangements. If you choose the annuity or flexible option, you may only be able to transfer to locally approved drawdown providers, retirement annuity trusts or similar.
How to make changes
You don't need to make investment changes if you don't want to. The default option is managed by the Trustee on your behalf, so you don't have to make any investment choices yourself. If you do want to make any changes though you can do.
You can change your LifePlan option or your investment strategy at any time on Your Pension. You can also set your target retirement age, or check what your default retirement age is, if you haven't done so already (if you're saving in LifePlan we recommend that you do this).
If you’re registered on Your Pension:
If you’re not yet registered on Your Pension:
If you’re thinking about changing your investment choices, please remember that pensions are a long-term investment and that the value of investments goes up and down. Some volatility is to be expected and we would advise against making any hasty decisions during periods of financial uncertainty.
If you’re unsure about any of the investment decisions you have to make, it’s strongly recommended that you contact an Independent Financial Adviser (IFA). You can find details of an IFA in your local area by visiting Unbiased or the Finding an adviser page of the Financial Conduct Authority’s website.
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