AGPP Guide 1

8/13/2019 AGPP Guide 1

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Whats on this CD?

Supporting tools and information to help you make decisions about your company pension

Key Features & Example Illustrations

The Key Features and example illustrations provide

important information about your company pension.

Please read these documents before joining.

Booklets

Pension Investment Approach Guide

Pension Funds Investors Guide

Your guide to with-profits

Policy Provisions

Important notes for application

Indulge-o-meter

Find out if spending a bit less on

treats could give you spare cashfor your company pension.

Pension planner

Use this to show how much you might get when

you retire.

Investment Decision ToolUse this to automatically match yourself to the most

suitable investment option for you.

Literature & Tools

To access the literature and tools on this CD you will

require internet access. After reading this literature, we

recommend that you either save or print a copy and

keep this safe for future reference.


3/36www.scottishwidows.co.uk/agpp 1

What we mean when we say 2

Whats in it for me? 3

Why you should consider joining your company pension

Whats best for me? 5

Your invitation to join 5

Why join? 6

Salary sacrifice 6

How much can I contribute? 8

What about the State Pension? 9

What else could you be relying on in your old age? 10

How much income will I need to live on when I stop work? 11

How much should I pay into my company pension? 13

What are the charges? 15

How will my pension fund be invested? 15

Use our Investment Decision Tool 18

Want to take a more hands on approach

to investing your company pension? 21

Self investment option 26

Changing your investment choice later on 27

Retirement/death/leaving 29

What happens if I die before I retire? 29

What happens if I leave before I retire? 29

Why your employer has chosen Scottish Widows? 30

How to join 31

What next? 31

Need advice? 31

Online access 32

Useful contacts 32

Feedback 32

Contents

We hope this guide answers all your questions, but if not, please speak to the pensions department or go to

your plan website. Your plan website is shown at the bottom of each page.


4/36



Whats in it for me?Here are some reasons why you should consider joining your company pension

Your employer will make contributions in addition to the amount of your salary that

you choose to sacrifice

Using salary sacrifice to pay your pension contributions means you pay reduced

National Insurance contributions

It is a very tax-efficient way of saving for retirement

You have the opportunity to pay more into your plan to help boost your savings

for retirement

The sooner you start paying in, the longer your pension fund has the opportunity

to grow

If you leave your job, you can take your plan with you, including the payments

your employer has made

When you retire, you can take a tax-free cash lump sum, plus a taxable income for life

To help make your investment decision easier, we have designed some simple

investment tools

Its easy for you to join.

Your plan has been awarded a Pension Quality Mark in recognition of being a highquality defined contribution pension scheme. For further information please visit

www.pensionqualitymark.org.uk

Whatsinitform

e?


6/364 www.scottishwidows.co.uk/agpp

By sacrificing 80 ofyour reference salary per

month, your net payafter income tax and

National InsuranceContribution deductions

will reduce by just over

55 a month to save180 a month into

your plan*

*This assumes a basic

rate tax payer witha reference salary of

24,000 a yearsacrificing 4% of their

salary and theiremployer paying 5%

of reference salary.

W

hatsinitforme?



Whats best for me?

A step-by-step look at making your pension decisions

Whatsbestforme?

Your invitation to join

Your employer is working in conjunction with us andyour pension adviser to provide this company pension.

We hope you will decide to join.

If you do, it could be of life-long benefit to you.

By giving you this opportunity, your employer is

showing how much they value:

your contribution to their business, and

helping you with your financial security

in retirement.

Avoid having to work til you drop

Whatever your personal ambitions, youll need money

to enjoy life to the full. Thats where this company

pension could help.

State retirement ages are going up. Depending on your

age now, you may have to wait until 68 before getting

your Basic State Pension.

But, by joining this company pension you may be in a

position to retire earlier or have a better lifestyle when

you eventually stop work.

Whatever you want your retirement tobe, having a pension could help you

enjoy it more

Giving up work doesnt mean giving up living.

When you retire, what do you think youll be

looking forward to most?

your choice

No longer having to work

Spending more time at home and with

your family

Taking up new activities that you havent

had time for to date

Or something more exotic?

Seeing more of the world

Buying a place in the sun

Moving abroad

Enjoying the simple pleasures in life?


8/36



Salarysacrifice

Heres how salary sacrifice works

Lets assume:

Youre a basic rate tax payer with a reference salary

of 24,000 a year

You agree to sacrifice 4% of your reference salary

into your plan which amounts to 80 a month.

If you choose to sacrifice 4% of your reference salary,

your employer will pay an additional 5% into your plan.

By sacrificing 80 of your reference salary per month,

your net pay after income tax and National Insurance

Contribution deductions will reduce by just over 55

a month to save 180 a month into your plan.

*Please note that in a non salary sacrifice arrangement

members receive income tax relief as a result of their

net pension contribution being grossed up by basic rate

tax when it is paid to the pension plan. This means

the final income tax liability in the above example is

the same regardless of whether the gross pension

contribution of 960 is paid by you, or exchanged foran employer contribution of the same amount.

The example assumes that

You have a personal allowance of 6,475 a year

(so you only pay tax on any amount earned above

that) and

You only pay NI contributions on any amount

earned over 5,720. This is the primary earnings

threshold for tax year 2010/11.

You should remember that this is only an example

and not guaranteed. The value of the tax benefits of

a pension plan depend on your personal circumstances.Your circumstances and tax rules may change in

the future.

Tax year 2010/11Non Salary

Sacrifice

Salary

Sacrifice

Salary 24,000 23,040

Tax you pay 3,505* 3,313

National Insurance (NI)

you pay

2,011 1,906

Minus current pension

contribution

768 net

(960 gross)

n/a amount has

been sacrificed

Salary after tax, NI and

current pension

contribution

17,716 17,821


10/36



What about the State Pension?

Like most people, youll probably get something from

the Basic State Pension.

Currently men get this at 65 and women at an age

between 60 and 65, depending on when they were

born. By 2020 it will be 65 for both men and women,

and by 2046, it will be 68. So many of us may have to

work longer than we thought. Here are the current

amounts for the tax year 2010-11.

Will I get a full State Pension?

How much you get will depend on how much you

have paid in National Insurance Contributions (NICs)

during your working life. People reaching their State

Pensionable Age will need to have paid them

for a full 30 years.

As a result of salary sacrifice, your NICs will be lower.

This may impact your Basic State Pension if your

earnings are lower than the National Insurance lower

earnings limit which is 5,044 for 2010/11.

How do I get a State Pension forecast?

You can find out exactly how much money to expect

by contacting The Pension Service. You can ask for a

forecast by ringing them on 0845 3000 168 or applying

for one online at www.direct.gov.uk

Will I get the State Second Pension?

How much State Second Pension (this is sometimes

paid in addition to the Basic State Pension) you receive

will be based on a combination of factors, including:

Your average earnings

How long youve been employed

Whether this part of your pension has been built

up within State Second Pension (S2P) or by

contracting out of it.

The forecast will also tell you what you may get

from the S2P.

Your plan will not be used to contract you out of the

S2P unless you request us to do so. However, if you

have contracted out using another plan you willremain contracted out.

You can find out more on contracting out at:

www.direct.gov.uk/en/Pensionsandretirement

planning/StatePension/DG_183780

Please ask your pension adviser if youd like

to know more about contracting out.

WhatabouttheSt

atePension?

Basic State Pension Single Person Married Couple

Weekly amount 97.65 156.15

Monthly total 423.15 676.65

Yearly total 5077.80 8119.80



What else could you be relying on in your old age?

Some people enjoy planning their finances and being in control. Others avoid thinking about it for as long as possible,

and some do nothing at all.

There are a wide range of investments out there and some or all of them may play a part in your thinking, alongside this

company pension. Take a look below at some other options, and see how well they compare.

See how your company pension compares to some other investment options

# Your employer may change its level of contributions. Any employer contributions would stop if you leave the company.

* If under the inheritance tax nil rate limit, this can be tax-free.

** Please note its not possible to reclaim the 10% tax credit on UK dividends.

Tax treatment depends on your personal circumstances and may be subject to change in the future.

For more information on any of these investment options or their tax implications, please speak to a financial adviser.

onin

youroldage?

Investment Options

Your company

pension

Buy-to-let

property

Inheriting

moneyISAs

Your employer can pay in#

You can sacrifice your salary and increase your take home pay n/a

You cant spend the investment before you retire

You can take some of the proceeds or benefits tax-free

All of the income or proceeds is tax-free ** * **

You dont have to give up your time to manage things


13/36



toliveon

whenIstopwork?

Giving up work

doesnt mean giving

up living. When you

retire, what do youthink youll be

looking forward

to the most?


15/36

How much should I pay into mycompany pension?

Very few pensioners complain about having too much

money. So its probably best to pay in as much as you

can comfortably afford.

Your employer is also paying into your plan, so that

helps to spread the cost.

Finding enough spare cash for your

company pension

With all the pressures on your bank account mortgage,

credit cards, bills, car, kids, leisure activities etc you

may wonder where youll find enough money to pay

into your company pension each month.

If so, it might be worthwhile taking a closer look at your

spending. You may be surprised by how quickly little

items of non-essential expenditure add up.

This may encourage you to pay some of this money

into your company pension instead without spoiling

your fun!

How much extra could you findin your budget?

If you kept a close eye on your shopping this month,

how much extra do you think you could find to pay into

your pension?

Try using the Indulge-o-meter on the enclosed CD

(if youre reading this on paper) to find out how

much youre spending on lifes little luxuries.

Increasing your payments as theyears go by

A lot could happen to the value of todays money by

the time you actually retire. So youll need to think

about how inflation could affect you.

To help you judge how quickly the rising cost of

living can affect the buying power of money,

heres an example.

Increasing your payments to your pension each year can

help protect against the effects of inflation, and may help

maintain the purchasing power of your pension.

www.scottishwidows.co.uk/agpp 13

HowmuchshouldIpayinto

mycompanypension?

I could find about

a month

Little cutbacks could give yousome spare cash to pay into yourcompany pension.

Approximate

monthly saving

Walk to work once a month instead

of taking a bus 1.00

Eat one less chocolate bar a week 2.20

Buy one less magazine a week 3.80

Catch one less taxi a month 7.50

Smoke one less cigarette a day

(20p each) 6.00

Hire one less DVD a month 3.50

Have one less take away for two,

a month 11.00

Buy one less CD or DVD a month 11.00

Have one less glass of wine

at the pub each week 12.00

Make one less mobile phone call a day 12.00Money you could sacrifice into your

company pension instead 70.00

today 1,000

after 10 years 744

after 20 years 553

What 1,000 is worth based on

3% a year inflation



py

intomypensionfund?

A company pension

is a good way to help getthe retirement income

you need. Unless your

retirement is already on

the horizon, you may

struggle to picture exactly

what youll be doing in

20-40 years time.

But whatever you want

your retirement to be,

a company pension

should help you give

a financial cushion to

enjoy it that bit more.



Whatarethecharges?

What are the charges?

Regular charges based on the value of your plan are

deducted automatically and the amount depends on

the type of payments being made and your choice of

investment fund(s). Some of our funds are externally

managed you may have to pay more for these and

certain other specialised funds we offer.

The yearly rates of all these charges are expressed as

percentages of fund values. The charges are reflected

in the unit price of the fund(s) youre invested in.

As an example, if the value of your plan was 5,000

throughout the year and the yearly charge of the fund

it was invested in was 0.3%, the charge for that year

would be 15.

Your employer has negotiated with Scottish Widows

to reduce the charges that apply to your plan while

you remain in their employment and regular monthly

payments continue to be paid into your plan. This

reduction is known as a scheme member discount.

If you leave your employer or regular monthly

payments stop being paid into your plan for more than12 months, the scheme member discount will stop and

higher charges will apply. If you leave your employer

and wish to continue to receive a scheme member

discount you can do so by continuing to pay the

current minimum gross contribution of 100 a month

directly into your plan.

If at any time the scheme member discount stops

applying to your plan, we will write to let you know.

Please note that charges, limits and terms can change.

How will my pension fundbe invested?

Your employer, in conjunction with your pension adviser,

has chosen the Balanced Pension Approach as the

default option for contributions. Your first contribution

will be invested in the Balanced Pension Approach.

The graph explains how the Balanced Pension Approach

works. It illustrates how your pension fund is invested

and the gradual switch to different investment funds

as you approach your retirement date.

The percentages shown are approximate and the fund

mix and funds used in the approach may vary in future.

UK and Global equity

SW SSgA 50:50 Global Equity Index Fund

Gilts & Bonds

Scottish Widows Corporate Bond Fund

Scottish Widows Indexed Stock Fund

Scottish Widows Pension Protector Fund

Cash

Scottish Widows Cash Fund

What other investment choices will I have?

You can choose to stay in the Balanced Pension

Approach or you can:

Simply choose one of our other Pension Investment

Approaches based on your feelings about risk, and

let us manage this through to your retirement,

or

Be very hands-on selecting from our wide range of

internally and externally managed investment funds.

The next section of the guide explains whats involved

with these options.

0

20

40

60

80

100

% Target fund holding

15 10 5 4 3 2 1

Number of years to retirement date

0



yp

fund

beinvested?

Cautious

Adventurous

Adventurous Pension Approach

A plan using this Pension Investment Approach is expected to have

the most frequent and noticeable ups and downs in value. It has the

potential to provide the highest growth over the longer term, but it

could also make the biggest losses.

About our three risk-based PensionInvestment Approaches

Not everyone wants to be actively involved with picking

investments and keeping a close eye on whats

happening in the market. If this sounds like you, one of

our three specially designed Pension Investment

Approaches may be just what you need.

Simply tell us which one suits you best. They all work

in a similar way. The difference between them is how

much investment risk they take in trying to help yourpension fund grow. With all three approaches, we

gradually reduce the risk the closer you get to

retirement, to help protect the final value of your

pension fund.

The discounted total annual fund charge for

the Pension Investment Approaches is currently 0.3%

and the non-discounted total annual fund charge is

currently 0.8%.

Balanced

Balanced Pension Approach

This Pension Investment Approach should have moderate ups and

downs compared with the other two approaches.

Cautious Pension Approach

A plan invested in this Pension Investment Approach should experience

smaller and less-frequent ups and downs in value than the other two

approaches. But its growth potential is lower as a result.

Need help choosing?

If youre unsure which approach may suit you best,

use our Investment Decision Tool to find your match.

It asks you 10 simple questions to help you decide

your risk approach.

Youll find an interactive version on the enclosed

CD (if youre reading this on paper) and if youre

online at www.scottishwidows.co.uk/idt

Or, use the paper version on pages 18 to 20of this guide.



Howwillmypension

fundbeinvested?

Whats special about these approaches?

They take into account the fact that investments need

to do different jobs for your company pension at

different times:

for the main part they aim to grow your pension

fund as much as possible whilst matching the level

of investment risk youve chosen

the closer you get to retirement, they gradually

switch from an aim of going for growth to helping

protect what youve built up.

How do we decide which investmentsto use?

Thats easy. Everything is decided in advance, based on

rigorous investment testing. Instead of switching

investments in reaction to whats happening day to day

in the stockmarket, we invest according to the approach

youve selected and how close you are to retiring.

When originally designing our Pension Investment

Approaches, we put a huge range of investments under

the microscope. This enabled us to:

Rule out unsuitable ones too risky or not enough

potential growing power

Select types we felt were right for company pensions

Identify what we believe are the best investment

combinations for people with different ideas about

risk and different terms to retirement.

How do we monitor your investments?

We constantly monitor your company pension to ensure

it is invested according to your chosen approach. This is

known as lifestyling and works like this:

Up to 15 years before your retirement date we

check every three months to see if any investment

ups and downs have caused the investment mix to

go adrift. If it has, we adjust it. The new mix will be

based on how much closer you are to retirement at

that time.

From 15 years before your retirement date we

gradually start replacing some of the higher risk

investment funds with lower risk ones.

In the last five years before your retirement date

we gradually start switching to lower risk

investment funds, to help protect the value of your

pension fund during the run-up to your retirement.

At your retirement date your pension fund will

be split approximately:

25% in our Cash Fund

75% in our Pension Protector Fund

ready to provide your tax-free cash and income for life.If you retire earlier than your selected retirement

date this will have an impact on any lifestyling as

your investments will be at a different stage of

switching than originally intended.

Governance

An important benefit of the Scottish Widows Pension

Investment Approaches is the robust governance review

undertaken by us each year.

This process looks in detail at a number of key

components of the approaches including:

The asset mixes used

The proportions of those assets used at the various

stages of the lifestyle switching

The switching timeframes within the lifestyle

switching phases

The funds used to provide exposure to the

required assets

Assessment of new asset classes for possible

inclusion in the Approaches.

We undertake to communicate the results of this reviewprocess, highlighting any changes which affect your plan.

Want more information?

Please see our Pension Investment Approach Guide.

For more information on our fund aims and risks,

please refer to our Pension Funds Investors Guide.

Youll find these on the CD (if youre reading this

on paper) or on your plan website at

www.scottishwidows.co.uk/agpp



yp

fund

beinvested?

Use our Investment Decision Tool

Our Investment Decision Tool is a quickquestionnaire to show you which of ourthree Pension Investment Approachesmay suit you best

An interactive version is also available on the CD

(if youre reading this on paper) or online at

www.scottishwidows.co.uk/idt

What to do

Using the tool, which you can do in just a few minutes:

1. First answer the questions in the panels starting

opposite, using the tick boxes as you go.

There arent any right or wrong answers, so go with

your instinct!

2. At the end, add up your scores (these are shown

within the tick boxes).

3. Then mark your total score on the investment scale

overleaf.Doing this will match you to one of our three

Pension Investment Approaches Adventurous,

Balanced or Cautious.

Thats all there is to it

But the final decision is yours. If you dont agree with

the result, youre free to choose a different approach.

Youll be responsible for deciding which investment

approach suits you best. If you need any more help

deciding please speak to your pension adviser.

Inexperienced

Reasonably experienced

Experienced2

1

0

2. When it comes to investing, how would

you describe yourself?

your choice

Limiting loss is more important than getting

above-average returns

Limiting loss and achieving above-average

returns are equally important

Achieving above-average returns is more

important than limiting loss

2

1

0

3. When it comes to investing, what are

you most concerned about?

your choice

Take it all in cash

Take half cash and half shares

Take it all in shares2

1

0

1. Your employer offers you a bonus,

which you can take as cash, shares or

a mixture of both. The shares have a

50/50 chance of doubling in value, or

becoming worthless over the next year.

What would you do?

your choice

Get out quickly

Sell some of my investment

Stay put2

1

0

4. If you were investing in the UK

stockmarket and it suddenly fell by

40%, what would you do?

your choice



Howwillmypension

fundbeinvested?

Potential Loss Potential Profit

-6,000 -4,000 -2,000 10,000 +2,000 +4,000 +6,000

0

1

2

Not answer and take the 5,000

Eliminate 2 wrong answers, leaving a choice

of 2. If you guess right youll have 7,500.

If not, youll get only 2,500

Guess the answer. If youre right, youll have

10,000. If not, youll get nothing

2

1

0

6. You are appearing on the hit game show

Win a Million! But you dont know the

answer to the next question. What would

you do?

your choice

5. This chart shows how much you could

make or lose in a year, with three imaginary

investments of 10,000. But you wont

know in advance what the result will be.

Which one would you invest in?

your choice All in shares

Mostly in shares, but also other investments

Mostly in lower risk investments but also some

in shares

0

1

2

8. How would you end this statement?

With a long time to go before I retire

its important to invest my pension ...

your choice

15,000 a year

10,000 a year, plus a performance bonus of

0 to 10,000

5,000 a year, plus a skys the limit

performance bonus

2

1

0

7. Youre offered a new sales job with a

choice of three pay options. Which onewould you take?

your choice

My total score is

Switch whats left into something safer thats

less likely to fall, but offers lower returns

Stay where you are, in the hope of recouping

your losses when the market picks up again

Stay where you are and invest more money

while share prices are low, in the hope of

making more money when the market

picks up again

2

1

0

10. Two years ago you invested 10,000 in a

stockmarket fund. But the value recently

fell to 8,500. What would you do?

your choice

Avoiding losses

Wanting to make money

Both are equally important1

2

0

9. When making a big investment decision,

what is more important to you?

your choice


22/36

Using your result

How you invest your company pension is entirely

up to you.If youre happy with your result, all you need to

do is select that approach. You can do this online

via the online member services or by contacting

us. If you were on the border of two approaches, you

will need to decide which one you prefer. Taking your

retirement date into account may help you do this.

For example, if it is:

Quite a way off, you might go for the approach that

has the higher growth potential of the two, or

Just round the corner, you may want to opt for the

one that should have fewer ups and downs.

Of course, you may decide you want to be a hands-on

investor instead. In which case, you can link your

company pension to a selection of pension funds

from our range. Please see pages 22-25.

Your result

Mark your total score on this investment scale, to see which of our three investment approaches might suit you best.

If youd like to know more about each approach, please see the Pension Investment Approach Guide. Youll find it on

the CD (if youre reading this on paper) or on the literature page if youre online.

2019

18

17

16

1514

13

12

11

109

8

7

6

54

3

2

1

0

Adventurous

Balanced

Cautious

20 www.scottishwidows.co.uk/agpp

yp

fund

beinvested?



Wanttotake

amore

hands-onapproach...?

Want to take a more hands-onapproach to investing yourcompany pension?

Your other option

If you decide to invest in our investment funds instead

of using our Pension Investment Approaches, you will be

responsible for choosing funds that suit your attitude to

risk. You can invest in up to 10 of them at one time (but

there may be restrictions on the amount you can investin some funds) and switch between them free of

charge, whenever you wish:

Some funds are managed by Scottish Widows

Investment Partnership (SWIP), and

Some by other UK investment managers,

such as Fidelity, Schroders, Invesco Perpetual,

Jupiter and Newton.

Most of the investment funds have been placed into

our different risk approach ratings to help make your

investment choice easier. The funds and their charges

are listed in the coming pages but you can find outmore about them in our Pension Funds Investors

Guide on the enclosed CD.

Please remember, if you go down this route:

You should regularly review your choice to decide

whether its still right for you. If you decide it isnt,

you can ask us to switch to another fund (or funds)

or you can do this online via the online member

services as we wont automatically do this for

you, and

Some of the funds may have a higher yearly charge

compared to those used for the PensionInvestment Approaches. A complete list of our

fund range and total annual fund charges can

be found on pages 2225.

We may change the selection of funds we make

available at any time.

Is being hands-on right for you?

Have you done something like this before? If youre not

confident about making the right moves at the right

time, you may want your pension adviser to help you.

These funds have been placed into our different risk

approach ratings to help you choose but youll be

responsible for deciding when and where to invest and

if/when to switch.



hands-onapproach...

?

Scottish Widows Investment Funds at a glance

There are a number of different ways to evaluate risk, Scottish Widows use the following definitions to help you decide

on the appropriate investment approach for you. You should read the Pension Funds Investors Guide on the CD.

The following table categorises our funds in accordance with these investment approach risk categories. The funds

are listed alphabetically in each risk category, with Scottish Widows Internally Managed Funds first. It also details

information on the annual fund charges that apply to each fund. Scottish Widows do not offer any funds that are

categorised as secure. Secure investments provide safety to the amount invested and can be expected to offer relatively

low growth over the medium to long-term. They cannot fall in actual value but can fall in real value due to the effects

of inflation. Types of secure investments would be National Savings Accounts and Bank/Building Society Term Accounts.

We may change the risk categorisation of funds in the future. Please go to your plan website to see if any

changes have been made.

Information regarding the fund aim and any associated risks can be found within our Pension Funds Investors Guide

on the CD.

SECURE CAUTIOUS BALANCED PROGRESSIVE ADVENTUROUS SPECIALIST

INCREASING RISK

Scottish Widows

Investment

Approach Rating Fund Name

Discounted

Total Annual

Fund Charge (%)

Non Discounted

Total Annual Fund

Charge (%)

CAUTIOUS

Scottish Widows Cash Fund 0.300 0.800

Scottish Widows Cautious Portfolio Fund 0.900 1.400

Scottish Widows Corporate Bond Fund 0.300 0.800

Scottish Widows Fixed Interest Fund 0.304 0.804

Scottish Widows Pension Protector Fund* 0.300 0.800

Scottish Widows UK Fixed Interest Tracker Fund 0.300 0.800

SW Fidelity MoneyBuilder Income Fund 0.773 1.273

SW Invesco Perpetual Corporate Bond Fund 1.093 1.593

SW JPM Cautious Total Return Fund 1.105 1.605

SW Schroder Gilt & Fixed Interest Fund 0.605 1.105

SW SSgA Sterling Corporate Bond All Stocks Index Fund 0.300 0.800

SW SSgA Sterling Liquidity Fund 0.300 0.800

* This fund has a cautious approach when used for investment approaching retirement.

BALANCED

Scottish Widows Balanced Portfolio Fund 0.900 1.400

Scottish Widows Cautious Managed Fund 0.652 1.152

Scottish Widows Defensive Managed Fund 0.612 1.112

Scottish Widows Diversified Assets Fund 0.900 1.400

Scottish Widows High Income Bond Fund 0.800 1.300

Scottish Widows Indexed Stock Fund 0.303 0.803

Scottish Widows Multi-Manager Diversity Fund 1.172 1.672

Scottish Widows SafetyPlus Fund 0.300 0.800

Scottish Widows Strategic Income Bond Fund 0.300 0.800

Scottish Widows Unitised With-Profits Fund * *

SW Fidelity Multi-Asset Strategic Fund 1.467 1.967

SW Invesco Perpetual Distribution Fund 1.197 1.697

SW Invesco Perpetual Global Bond Fund 1.094 1.594

SW Investec Cautious Managed Fund 0.839 1.339

SW Jupiter Distribution Fund 1.097 1.597

SW New Star Fixed Interest Fund 0.953 1.453


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hands-onapproach...

?

ADVENTUROUS

SW BlackRock UK Smaller Companies Fund 1.174 1.674

SW BlackRock UK Special Situations Fund 1.178 1.678

SW Fidelity 50:50 Special Situations Fund 1.232 1.732

SW Fidelity American Fund 1.222 1.722

SW Fidelity European Fund 1.269 1.769

SW Fidelity Global Special Situations Fund 1.238 1.738

SW Fidelity Special Situations (2006) Fund 1.227 1.727

SW Invesco Perpetual High Income Fund 1.236 1.736

SW Investec American Fund 1.114 1.614

SW Investec Global Free Enterprise Fund 1.131 1.631

SW JPM Europe Dynamic (ex-UK) Fund 1.155 1.655

SW Jupiter Income Fund 1.254 1.754

SW Jupiter UK Growth Fund 1.332 1.832

SW Jupiter Undervalued Assets Fund 1.343 1.843

SW New Star Higher Income Fund 1.259 1.759

SW New Star UK Alpha Fund 1.274 1.774

SW Newton 60-40 Global Equity Fund* 0.854 1.354

SW Newton Growth Fund 0.640 1.140

SW Newton Higher Income Fund 0.796 1.296

SW Newton International Growth Fund 0.640 1.140

SW Newton UK Equity Fund 0.855 1.355SW Schroder European Alpha Plus Fund 1.175 1.675

SW Schroder Global Property Securities Fund 1.216 1.716

SW Schroder Income Maximiser Fund 1.201 1.701

SW Schroder UK Alpha Plus Fund 1.203 1.703

SW Schroder UK Mid 250 Fund 1.217 1.717

SW SSgA 50:50 Global Equity Index Fund 0.300 0.800

SW SSgA Europe ex UK Equity Index Fund 0.300 0.800

SW SSgA International Equity Index Fund 0.300 0.800

SW SSgA North America Equity Index Fund 0.300 0.800

SW SSgA UK Equity Index Fund 0.300 0.800

SPECIALIST

Scottish Widows Emerging Markets Fund 0.800 1.300

Scottish Widows Japanese Fund 0.300 0.800

SW Baillie Gifford Japanese Equity Fund 0.750 1.250

SW Fidelity Japan Fund 1.251 1.751

SW Fidelity South-East Asia Fund 1.323 1.823

SW JPM Emerging Markets Fund 1.155 1.655

SW JPM Natural Resources Fund 1.155 1.655

SW Newton Oriental Fund 0.870 1.370

SW Schroder Tokyo Fund 1.215 1.715

SW Schroder US Smaller Companies Fund 1.215 1.715

SW SSgA Asia Pacific ex Japan Equity Index Fund 0.300 0.800

SW SSgA Japan Equity Index Fund 0.300 0.800

* From April 2010 this fund will be changed to SW Newton 50:50 Global Equity Fund.

Scottish Widows

Investment

Approach Rating Fund Name

Discounted

Total Annual

Fund Charge (%)

Non Discounted

Total Annual Fund

Charge (%)


27/36www.scottishwidows.co.uk/agpp

We also have four Pension Portfolios which are used in our Pension Investment Approaches. The Pension Portfolios have not

been risk rated in line with our other fund links as they were primarily constructed to provide specific asset class exposure

within our Pension Investment Approaches. These portfolios form the building blocks with which we operate our Pension

Investment Approaches and as such the same portfolio can be used in more than one Pension Investment Approach.

Please see the Pension Investment Approach guide on the CD for more details.

The table below details the total annual fund charges that apply to the four pension portfolios.

Fund NameDiscounted Total

Annual Fund Charge%

Non Discounted Total

Annual Fund Charge%

Scottish Widows Pension Portfolio One 0.300 0.800

Scottish Widows Pension Portfolio Two 0.300 0.800

Scottish Widows Pension Portfolio Three 0.300 0.800

Scottish Widows Pension Portfolio Four 0.300 0.800

25

Notes

1. The Discounted Total Annual Fund Charge is equal to

the Non-Discounted Total Annual Fund Charge less the

scheme member discount. If you leave your employer

or regular monthly payments stop being paid into your

plan for more than 12 months, the scheme member

discount will stop and the Non-Discounted Total Annual

Fund Charges will apply to your plan. If you leave your

employer and wish to continue to receive a scheme

member discount you can do so by continuing to payat least the minimum monthly contributions applying

at the time. This is currently a gross contribution of

100 per month.

2. The applicable Total Annual Fund Charge of a

fund is the sum of:

a) the Scottish Widows Annual Management Charge,

b) if applicable, an External Fund Management

Charge,

c) if applicable, a Multi-Manager Fund Management

Charge, and

d) if applicable, an allowance for any Other Expenses.

The Management Charges of a), b) and c) above coverfund management, administration, marketing and the

cost of sales, and also for c) the multi-manager

selection service.

Other Expenses include, for example, trustees

fees, auditors fees and regulators fees. For the

Scottish Widows Multi-Manager Diversity Fund

weve not allowed for any annual management

fees or performance fees charged by investment trusts

or certain investment companies which the fund may

invest in. The allowance for Other Expenses can

change on a regular basis.

If any of a) to d) above changes for a fund, theapplicable Total Annual Fund Charge for that fund

will also change.

3. We may add or take away units from your plan in order to

arrive at the correct level of charges for your plan. Please

see your policy documents for more information.

4. This leaflet should be read in conjunction with the

relevant product literature, including our Pension Funds

Investors Guide and any Key Features illustrations.

5. The value of an investment is not guaranteed and can

go up and down depending on investment performance

(and currency exchange rates where a fund investsoverseas).

6. What you get back from investing in the With-Profits

Fund depends mainly on the investment profits and

losses of the fund and the decisions we make about

their distribution, and is only guaranteed in certain

circumstances. If you cash in at other times we may

apply Market Value Reductions. You could get back less

than you invested. Please read the Key Features and

With-Profits Guide for further details.

7. Full terms and conditions are available on request from

Scottish Widows. Charges, terms and limits may change.

8. We may change the selection of funds that we makeavailable. There may be restrictions on the amount that

can be invested in certain funds. Please contact us for

details of any restrictions that apply.

9. The Total Annual Fund Charges are those current at the

time of going to print (May 2010).

10. SafetyPlus is a registered trademark of

Scottish Widows Plc.

11. Details provided in this leaflet reflect the fund charges

available for the AECOM Group Personal Pension.

For details of the fund charges for other Scottish Widows

Pension products please contact us.

12. Please see our Pension Investment Approach guide forinformation on the underlying investment funds used

by each approach. The Total Annual Fund Charges

shown in this section are applied to these underlying

investment funds.

Wanttotake

amore

hands-onapproach...?


28/36www.scottishwidows.co.uk/agpp26

Selfinv

estmentoption

Self investment option

If you want greater investment choice and control

you can establish a Retirement Account using our self

investment option which will link to your company

pension. You can use it in addition to your company

pension to invest in a wider range of investments.

As long as you keep a minimum amount in your

company pension, its up to you how you allocate your

retirement savings between the two pension plans.

As well as access to Scottish Widows internal and

externally managed funds and our Pension

Investment Approaches you have access to:

Fund Supermarket

Share Dealing

Discretionary Fund Managers

Commercial Property Purchase

Fund Supermarket

Many clients may feel that theres more than enough

choice within our range of Scottish Widows Pension

Funds. However, perhaps you have a specific fund in

mind that youd like your Retirement Account to invest

in. Within the Retirement Account we offer a Fund

Supermarket which provides access to a large range of

external funds. Whats more, because weve negotiated

terms on behalf of our customers, you could benefit

from lower investment charges on the funds offered

through the Fund Supermarket than if you were buying

them direct.

Share Dealing

Separate Share Dealing accounts can be set up for

each part of your Retirement Account. This allows

direct investment in stocks and shares instead of an

HM Revenue and Customs recognised stock exchange.

Once set up this will allow you or your pension adviser

to invest directly in stocks and shares with our Share

Dealing partner Stocktrade.

Full details of the assets available to you and the

charges applying are available in our RetirementAccount guide.

Discretionary FundManagement Services

Your pension adviser may decide that your investment

needs require a more bespoke service to manage your

Retirement Account investments. We offer access to a

panel of Discretionary Fund Managers who your

pension adviser can choose to work with to look after

your Retirement Account investments. Your chosen

Discretionary Fund Manager(s) will develop an

investment strategy taking your individual objectivesand requirements into account.

Commercial Property

Under current tax rules, your Retirement Account can

help you gain significant tax efficiency from commercial

property investments, although this does mean, for

example, that you will be unable to access the value

of the property until you retire.

A Retirement Account will not be suitable for everyone

and different charges will apply. You should contact

your pension adviser for more information.

You can also find more information on the self

investment option on your plan website

at www.scottishwidows.co.uk/agpp



Changing your investment choicelater on

Whatever investment choice you make atthe start, youre free to change your mindand switch to something else later on

Switching is currently free and you can:

Do it at any time

Move from investment funds into one of ourPension Investment Approaches, or from an

Approach into one or more investment funds

Spread your company pension in up to 10

investment funds at once.

But you cant invest:

In more than one Pension Investment Approach at a

time, or

In both investment funds and a Pension Investment

Approach at the same time.

Delays in switching may apply in certain circumstances.Please refer to your Policy Provisions for further information.

Will my pension fund go up anddown in value?

Yes, ups and downs are part and parcel of investing.

But over the longer term the aim of our investment

funds and the three Pension Investment Approaches

is to achieve long-term growth.

Whatever you decide, remember that the value

of the investment is not guaranteed and may

go up and down depending on investment

performance (and currency exchange rates

where a fund invests overseas).

For the Unitised With Profits fund, please refer

to note 6 on page 25.

Time to decide

What investments will you choose for your

company pension?

Are you going to be a hands-on investor and

self-select investment funds from our wide range

of funds, or

Choose one of our Pension Investment Approaches,

and let us do the work?

You may want to make a note of yourinvestment choices below.

Adventurous Pension Approach

Balanced Pension Approach

Cautious Pension Approach

Hands-on

Number of years until you retire

Your investment choice

your choice

27

Changingyourinvestment

choicelateron


30/36



RetirementWhen you retire, you can use the value of your plan

to provide you with benefits. In general, this is a cash

sum and a pension often referred to as an annuity.

An annuity is an income you receive for the rest of

your life. Under current law, you can take up to 25%

of your fund as a tax-free cash sum and use the rest

to buy an annuity.

You can choose what type of annuity you receive,

as follows.

You can choose whether to receive increases to your

annuity each year and at what rate (for example, 3%).

You can choose to have a percentage of your

annuity paid to your husband, wife, partner or

dependant if you die (for example, 50%).

You can have your annuity guaranteed to be paid

for a specific period (for example, for five years).

Your plan also offers you an open market option when

you retire which allows you to buy your annuity from

another pension provider if you want to.

Your employer offers an annuity service to help with theopen market option. Your pension adviser will search

for the best rates available from a pool of leading

annuity providers based on what type of annuity you

choose and the value of your plan. For more information

please contact the pensions department.

What happens if I diebefore I retire?

If you die before you retire, we will normally pay the

value of your plan as a lump sum to your nominated

beneficiaries (the people you have chosen to receive

the benefits of your plan when you die).

Your employer also pays for a separate life assurance

scheme which provides benefits if you die whilst you

work for them for your nominated beneficiaries. This

is not provided by us.

Please refer to your pensions department for further

information.

Your dependants will have to pay tax on the value

of any lump sum death benefit that is above the

lifetime allowance, but very few people are likely

to be affected by this.

What happens if I leavebefore I retire?

If you leave your employer before you retire, there is no

refund option and you can take your plan with you,

including the payments your employer has made. No

further contributions will be made by your employer but

you have the option to continue to make personal

contributions direct if you wish. The scheme member

discount will normally stop and higher charges will apply.

If you wish to continue to receive a scheme memberdiscount you can do so by continuing to pay the current

minimum gross contribution of 100 per month directly

into your plan.

You will continue to receive a statement each year from

us and you have the same options regarding investment

choices and when you are able to take your benefits.

If you get a new job you can ask your new employer to

make payments to your plan or you may be able to

transfer the value of your plan into your new employers

scheme. You should take independent financial advice

before deciding to transfer.

Delays may apply to transfers in certain circumstances.

Please refer to your Policy Provisions for further information.

29

Retirement/death/leaving



Why your employer has chosenScottish Widows

A name you can trust

After researching the market, your employer has chosen

us to provide your company pension.

Here are some reasons why they felt we came out top:

In a February 2010 Ipsos survey, consumers rated us

as one of the top financial organisations they mostwant to deal with. Ipsos run these surveys across the

financial services sector.

Ipsos is an independent company whose sole focus

is survey-based market research.

Were part of the Lloyds Banking Group, currently

one of the top 100 companies listed on the London

Stock Exchange.

Were experts in group pensions, we currently look

after over 40,000 schemes.

Giving an excellent and thoughtful service is very

important to us.

Weve been around for nearly 200 years, and thats

important. Weve been helping people save for a

long time and we want to see if we can help you do

the same.

All these success factors help to make Scottish Widows

one of the UKs leading financial institutions and a

company you can rely on.

yy

p

y

chosenScottishWidows

30


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Online access

By joining your company pension, you have online

access to your plan. This includes:

Current and historic fund values

Access to unit purchase history

Change address/contact details

Request copies of previous annual benefit statements

Fund switching.

What if? calculator.

Our range of online services provides you with a quick

and simple way to keep track of your plan.

You can access these facilities online at

www.scottishwidows.co.uk/agpp

Your employer takes its responsibility seriously and

would like to make sure it provides the best possible

services to members. Therefore your employer may

sometimes obtain details of the value of your pension

fund for the purposes of administering your plan.

Useful contacts

Pensions Department

Tel: 01727 535832

Email: [email protected]

Scottish Widows Helpline

Tel: 08457 556 557

TISCO Financial Planning Ltd

Tel: 01727 734 040

website: www.tisco.co.uk

Feedback

The pensions department welcomes any feedback on

any aspect of your plan. If you have any comments or

suggestions please visit the pension feedback area on

your employers intranet, myAECOM.

Online

access

32


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