Investment Summary
You have a number of investment funds from which to choose to invest your contributions. You may do this by completing an Investment Option Form. The funds give you access to the major asset classes and range from low risk to high risk.
If you do not make an investment choice yourself then your contributions, and those made on your behalf by your Employer, will by default be invested in the Default Investment Option, which is the ITB Drawdown Lifestyle Fund (see below), with a selected retirement age of 65. This invests across a range of investments according to the period before your retirement.
We recommend you seek advice from an Independent Financial Adviser when making your decision. Neither your Employer nor the Trustee are able to give you financial advice and they accept no responsibility for your investment decisions.
Members who are automatically enrolled cannot be required to make an investment choice before joining. So if you are automatically enrolled, your contributions will initially be invested in the Default Investment Option. However, you are encouraged to review the other investment funds available to you as the Default Investment Option may not be the best choice for you.
Details of the funds currently available and the Default Investment Option are shown below. Please note that the Trustee may change the provider of any fund and may withdraw some funds and replace them with others. They may do this in respect of future contributions only or in respect of funds already built up as well.
Lifestyle strategies
A lifestyle strategy is designed to meet a member’s investment objectives as they go through their career. This involves investing in higher risk/ higher reward funds during what is called a “growth phase” and then moving gradually to lower risk assets as a member approaches retirement. This move to lower risk assets is designed so that by the time a member reaches retirement their pension is invested in a way that aims to meet their retirement objectives.
There are three lifestyle strategies on offer – Drawdown, Annuity and Cash. All have the same purpose to provide a value at retirement. The strategy you choose will depend on how you may wish to access your DC account upon retirement. Full details of each lifestyle strategy are shown below.
Under the lifestyle strategies you are able to choose a target retirement age, which will determine the funds into which contributions are invested on your behalf and when these investments take place. The target retirement age you select is not binding and can be changed at any point by completing an Investment Choice form. If you do not make an election the target retirement date will be set to your 65th birthday. You may also change your investment strategy at any time by completing an Investment Option form (found in the document library).
ITB Drawdown Lifestyle (Default Option) Fund Code: LGG3
If you do not select a fund for investing your own contributions and the contributions that your employer will make on your behalf, they will automatically be invested in the Drawdown Lifestyle Fund. This is the “default” option determined by the ITB Trustee, as advised by its independent investment adviser.
Throughout the growth phase the strategy targets a mix of 35% in the L&G Low Carbon Transition Fund (foreign currency unhedged), 35% in the Low Carbon Transition Fund (foreign currency hedged) and 30% in the L&G Future World Multi-Asset Fund.
The L&G Low Carbon Transition Funds are invested in global equities, with a higher allocation in companies that are more valuable (known as market capitalisation) and a higher or lower allocation to some companies depending on their level of carbon emissions. The L&G Future World Multi-Asset Fund is invested in a diversified range of asset classes (excluding physical property) while reflecting significant environmental, social and corporate governance issues in the fund's investment strategy..
Starting 15 years before your planned retirement date, the allocation to the Low Carbon Transition Funds will be gradually reduced, and the Future World Multi-Asset Fund allocation will be increased up to an allocation of 75% at the target retirement age. In the final 5 years before retirement, an allocation to Cash will also be built-up. At the point of reaching the target retirement age your pot will be invested 75% in the Future World Multi-Asset Fund and 25% in Cash.
Annual charges at 15 or more years from retirement are 0.30% pa, from 14 to 12 years before retirement they are 0.31% pa, 11 to 9 years before retirement 0.32% pa, 8 and 7 years before retirement 0.33%, 6 to 1 year before retirement 0.34% and at retirement they are 0.35%.
ITB Cash Lifestyle Fund Code: LGH3
Throughout the growth phase the strategy targets a mix of 35% in the L&G Low Carbon Transition Fund (foreign currency unhedged), 35% in the Low Carbon Transition Fund (foreign currency hedged) and 30% in the L&G Future World Multi-Asset Fund.
Starting 15 years before your planned retirement date, the Low Carbon Transition Fund allocations will be gradually reduced, and the Future World Multi-Asset Fund allocation will be increased. In the final 5 years before retirement, the entire allocation will be gradually switched into Cash, so that at the point of retirement, your pot will be 100% invested in Cash.
Annual charges at 15 or more years before retirement are 0.30% pa. They increase gradually to 0.34% pa at 5 years before retirement and then reduce to 0.29% just before retirement.
ITB Annuity Lifestyle Fund Code: LGI3
Throughout the growth phase the strategy targets a mix of 35% in the L&G Low Carbon Transition Fund (foreign currency unhedged), 35% in the Low Carbon Transition Fund (foreign currency hedged) and 30% in the L&G Future World Multi-Asset Fund.
Starting 15 years before your planned retirement date, the Low Carbon Transition Funds and the Future World Multi-Asset Fund allocations will be gradually reduced, and allocations will be built-up to Index-Linked Gilts and Corporate Bonds. In the final 5 years before retirement, allocations will also be made to Fixed-Interest Gilts and Cash. At the point of retirement, your pot will be invested 18.75% in Corporate Bonds, 18.75% in Fixed-Interest Gilts, 37.5% in Index-Linked Gilts and 25% in Cash.
Annual charges at 15 or more years from retirement are 0.30% pa. They increase to 0.30% pa between 11 and 4 years before retirement and then reduce to 0.29% pa just before retirement.
| Fund Type/Name | Fund Aim | Risk Factor | Annual Charges* |
|---|---|---|---|
| Low Carbon Global Equity Fund: BXN3 L&G Low Carbon Transition Fund (unhedged) | The investment objective of the fund is to track the performance of the Solactive L&G Low Carbon Transition Global Index (less withholding tax where applicable) to within +/-0.60% p.a. for two years out of three. | High | 0.265% |
| Global Equity Fund Code: NRJ3 L&G Global Equity Market Weights 30:70 Index Fund | To provide diversified exposure to UK and overseas equity markets while reducing foreign currency exposure of 75% of the overseas assets. A 30/70 distribution between UK and overseas assets is maintained with the overseas allocation mirroring that of the FTSE All World (ex-UK) Index. | High | 0.34% |
| Future World Multi-Asset Fund Code: BT63 L&G Future World Multi-Asset Fund | The investment objective of the fund is to provide long-term investment growth through exposure to a diversified range of asset classes (excluding physical property) while reflecting significant environmental, social and corporate governance (ESG) issues into the fund's investment strategy. | Cautious | 0.36% |
| Multi-Asset Fund Code: NTW3 L&G Multi-Asset Fund | To provide long-term investment growth through exposure to a diversified range of asset classes. The diversified nature of the Fund means that the Fund is expected to have less exposure than an equity-only fund to adverse equity market conditions. However, the Fund may perform less strongly than an equity-only fund in benign or positive market conditions. | Cautious | 0.33% |
| UK Index-Linked Government Bond Fund Code: NEC3 L&G Over 5 Year Index-Linked Gilts Index Fund | To track the performance of the FTSE A Index-Linked (Over 5 Year) Index (including re-invested income) to within +/- 0.25% each year for two out of three years. | Cautious | 0.28% |
| UK Fixed-Interest Government Bond Fund Code: NBR3 L&G Over 15 Year Gilts Index Fund | To track the sterling total returns of the FTSE A Government (Over 15 Year) Index to within +/- 0.25% per annum for two years in three. | Cautious | 0.28% |
| UK Corporate Bond Fund Code: NEK3 L&G AAA-AA-A Corporate Bond (Over 15 Years) Fund | To track the performance of the Markit iBoxx £ Non-Gilts (ex-BBB) Over 15 Year Index (including re-invested income) to within +/- 0.50% each year for two years out of three | Cautious | 0.32% |
| Ethical Global Equity Fund Code: NEB3 L&G Ethical Global Equity Index Fund | To track the performance of the FTSE4Good Global Equity Index (including re-invested income) to within +/- 0.5% each year for two years out of three. | High | 0.50% |
| Islamic Global Equity Fund Code: BB43 HSBC Islamic Global Equity Index Fund | The Fund aims to achieve capital growth over the long term. The Fund will track the performance of the Dow Jones Islamic Market Titans 100 Index, while minimising as far as possible the tracking error between the Fund's performance and the performance of the Index. In addition, the Fund shall comply with Shariah Principles as interpreted and laid down by the Shariah Committee and provided to the Directors and the Investment Manager. | High | 0.55% |
| Cash Fund Code: EAB3 L&G Cash Fund | To provide capital protection with growth at short term interest rates. The fund invests in the short-term money markets such as bank deposits and Treasury Bills. | Minimal | 0.29% |
* The charges shown above include an L&G platform fee of 0.2% pa
High Risk
If you’re prepared to take high risk, it’s likely that you’re an experienced and knowledgeable investor, whose primary aim is to achieve higher possible returns on your money, while accepting that this means taking substantial risks.
Cautious Risk
If you’ve got a cautious attitude to risk, it’s likely that, when investing your money, you look for the security that your investment’s value usually won’t go up and down as much as High Risk investments.
Minimal Risk
If you’re only prepared to take minimal risk it’s likely that your main concern is the security of your money.
To find out more information about the funds referred to above and the risk and return associated with the different investments please refer to the Fund Factsheets (a link to the fact sheets can be found on ITB-online under Investment Choices).
Please note that the value of your investment can go down as well as up.
For further advice on investments you are advised to consult with an FCA approved Independent Financial Adviser a list of which can be found on the IFA Promotions website: www.unbiased.co.uk