Helping members with investment choices

Defined Contribution scheme members find it hard to make investment decisions

Too much investment choice can overwhelm your employees.

Most Defined Contribution schemes offer an enormous range of investment options, despite research revealing that too much choice confuses members and leaves them feeling dissatisfied.

To help them, it’s a legal requirement to set up a default way of investing. Unless members actively decide otherwise, and only 5% do, their contributions are paid into the default fund. That makes it really important to choose a default that suits as many of your members, and their retirement plans, as possible.

How can First Actuarial help you put the right default fund in place?

The default funds that many Defined Contribution schemes have in place are no longer fit for purpose, as they were designed when members had to buy an annuity at retirement. The new pension freedoms give members more choices at retirement, and default funds need to be updated to support this.

We work with you to select the most appropriate default fund, and help keep it under review so it continues to meet your members’ needs. Most providers offer their own default funds, but these involve differing levels of risk and vary in the returns they aim for. We will help you understand the aims of each default fund, its past performance and how it works. This will help you select the best provider for your needs.

More pension freedom for you and your Defined Contribution scheme members

If your preferred provider doesn’t offer a default fund that suits your members, we can help you design your own bespoke fund.

Besides the default fund, we can also help you set up a manageable range of additional funds for your Defined Contribution scheme members to choose from. This will give them the freedom to make their own investment decisions without overwhelming them.

Get in touch

Need help with your investment options? Get in touch with us today.

I would definitely recommend working with First Actuarial. Their consultants went over and above the call of duty to make sure the project progressed smoothly. In all areas – overall project and strategy scoping, Defined Contribution scheme and investment fund advice – the support has been exemplary.

– Claire Beesley, Project Manager, RSPB

Find out more about our Defined Contribution services

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