Aviva Master Trust – Workplace Retirement Account Mott ... · has been created for Mott MacDonald...

Workplace Retirement Account Investment guide | p1

Investment guide

Aviva Master Trust – Workplace Retirement AccountMott MacDonald My Money Plan

AV238928_AENGS638B_MM39040_0519.indd 1 5/15/19 12:13 AM

p2 | Workplace Retirement Account Investment guide

Workplace Retirement Account - Investment guide

Contents

4 Choosing how to invest your Workplace Retirement Account

6 Charges and expenses

7 Understanding investment programmes

9 The investment solution explained

12 Investment programme considerations

15 Help and further information



4 Choosing how to invest your Workplace Retirement Account

6 Charges and expenses

7 Understanding investment programmes

9 The investment solution explained

12 Investment programme considerations

15 Help and further information Our role as TrusteesWe, as Trustees* have a legal duty to ensure that the pension scheme offers a good range of high-quality funds for you to choose from. We do this by taking advice from investment experts and regularly reviewing how the funds are performing against the benchmarks and our expectations. If the funds are not performing as we would expect, we may decide to change them.

This could include where a fund manager is proposing to increase charges as we have a duty to ensure that the funds offer you value for money.

Whatever the outcome of our review, and if we choose to close or replace a fund, please be assured that we will notify you in advance and explain the choices you have.

*Independent Trustees - PTL, Rebecca Cooke, Anne Hunt and Jonathan Parker

This guide is produced by Aviva on behalf of the Trustees. In this guide we, us and our means the Trustees.

It explains how you can invest your pension savings. If you’re not confident about making your own investment choices you can remain in the scheme’s default investment solution.

You should read the Member guide and Investment fund aims and risk guide which can be found online at https://library.aviva.com/aengs638a.pdf and https://library.aviva.com/aengs638c.pdf. The member guide explains how the pension scheme chosen by Mott MacDonald Limited works.

About this guide

This guide explains some of the basics of investment, the choices you have and the things you will need to consider.


https://library.aviva.com/aengs638a.pdf

https://library.aviva.com/aengs638a.pdf

https://library.aviva.com/aengs638c.pdf



Choosing how to invest your Workplace Retirement AccountWhy is investment important?Regular contributions are paid into your Workplace Retirement Account (your Account). These contributions are used to invest and buy units in funds designed to increase in value over the long term.

A pension scheme should seek to get the best return possible for your pension savings whilst balancing this with the level of risk you are comfortable with. Choosing the funds you want to invest in is a very important decision.

Please be aware that the value of an investment is not guaranteed and can go down as well as up. The value of your Account could be less than what has been paid in.

Do I have to choose my own investments?No, we’ve chosen a default investment solution that we believe is appropriate for most members.

When you join the pension scheme, contributions will initially be invested in the default investment solution, which is called LIP Drawdown. You can find out how LIP Drawdown works on page 9.

Contributions will continue to be invested in LIP Drawdown, unless you choose to invest in one or more of the other funds available to you.

I’d like to choose my own investments; where do I start?If you decide to make your own choices from the available funds, there are a number of things you need to consider, including:• Your age and when you want to retire.

• How much income you’re likely to need in retirement.

• How you might want to access your savings at retirement.

• The type of investments you can choose from and how these are managed.

• Your attitude to investment risk and how this may affect your investment decisions.

• The charges for different types of fund management.

If you want to make your own investment choices, you can find out more about the available funds in the Investment fund aims and risk guide which can be found online at https://library.aviva.com/aengs638c.pdf.

Once you’ve thought about these, you will be better prepared to make your investment choices with your retirement goals in mind. If you are unsure about making investment decisions we recommend you speak to an independent financial adviser, you may be charged for this advice. You can visit www.unbiased.co.uk for a list of advisers in your area.



http://www.unbiased.co.uk


Review regularlyYou should regularly review

your investments. The ones

you use now may not be right

for you as your circumstances

change, especially as you

get closer to retirement.

Find out moreYou can find out more information about all of the funds available to you on our website:

www.avivamymoney.co.uk


http://www.avivamymoney.co.uk


Charges and expenses To cover the costs of running your Account and managing your investments, the following charges apply:

The Government has introduced a cap on pension charges which applies to the default investment solution for all workplace pension schemes. This means that if you remain invested in the default investment solution your total annual charge will not be more than 0.75% of your fund value. If you choose to invest in other funds the charges may be higher than this.

You can be assured that your scheme meets the Government charge cap rules and that the Trustees will monitor all investments to ensure you receive value for money.

All charges and expenses are reviewed regularly. If a scheme AMC or fund AMC changes Aviva will let you know.

Scheme Annual Management Charge

(scheme AMC)+

Fund Annual Management Charge

(fund AMC)= Total AMC

This covers the cost of running your Account. It is a percentage of your Account value that is calculated and applied daily, but deducted monthly from your Account by selling fund units. Aviva will charge a scheme AMC of 0.21% each year.

The fund AMC is charged by fund managers for managing a fund. It is normally calculated as a percentage of the fund’s value and deducted from the daily fund unit price.

The total AMC will depend on which fund or funds you invest in. It is taken from each fund, over the lifetime of your Account. It is made up of the scheme AMC and the fund AMC. You can see the total AMCs for each of the available funds in the fund table detailed on page 13 and in the Investment fund aims and risk guide.

+Additional Expenses

Most fund managers have to pay expenses, such as fees to auditors, trustees and valuers. You can see what they are for each fund in the fund table detailed on page 13 and in the Investment fund aims and risk guide. Additional expenses are payable in addition to the Total AMC.



Your default solution is an investment programme. We show the additional investment programmes you can choose from in the Investment fund aims and risk guide https://library.aviva.com/aengs638c.pdf.

An investment programme breaks your pension journey into two phases:

Growth phase – When you are a long way from retirement, your money is invested in funds that aim to grow the value of your pension savings over time.

Pre-retirement phase – In the years approaching retirement, the level of risk to which your money is exposed is gradually reduced, in preparation for taking your

pension benefits. The length of the pre-retirement phase is determined by the investment programme. For our My Future investment programmes, this is 15 years.

An investment programme will end at your investment programme end date. This will be the target date used to determine the mix of investments in your fund. It can be any date, up to and including your selected retirement date. You can change both at any time. If you continue to make contributions after your investment programme ends (for example, if you choose to take your pension benefits as income drawdown), these will be invested in the proportions shown in the ‘End’ column of the investment programme charts shown within this document.

An investment programme manages your investments throughout your pension journey. As you approach retirement it moves your investments in preparation for taking your pension benefits.

Understanding investment programmes




Lifetime investment programmesLifetime investment programmes are designed to do everything for you. A Lifetime investment programme begins when you join it and manages your investments throughout your pension journey.

Your contributions are invested in the funds which make up the investment programme. These funds are fixed for the life of your Account and cannot be changed.

You are unable to invest in other funds while you are invested in this programme. If you wish to choose your own investments, you must leave the investment programme.

If you leave a Lifetime investment programme, you must let us know how you would like future contributions to be invested.

Fundswitching

beginsEnd

Growthfund(s)

Pre-retirementfund(s)

Years

Your pension journeyThis diagram shows how investment programmes manage your pension journey, fromjoining your pension scheme to your investment programme end date.

Lifetime investment programme



A default investment solution, a Lifetime investment programme, has been created for Mott MacDonald Limited pension scheme, into which contributions will be invested. This means you don’t have to make your own investment decision.

The investment solution explained

We have chosen this investment programme after taking advice from our advisers.

Although we have made this selection for those who don’t make an investment choice, there are no guarantees that this investment programme is the most suitable for your own personal circumstances.

Your employer’s pension arrangement offers a ‘default’ investment strategy, the LIP Drawdown Lifetime Investment Programme (‘LIP Drawdown’). LIP Drawdown has been designed for members who expect to target income drawdown. Income drawdown is a product that allows you to draw a regular income from your pension savings while remaining invested. It is one of the options available to you when you come to choose how you will access your pension savings.

Your contributions will be invested in LIP Drawdown, unless you make your own investment choice. It is designed to provide an appropriate investment solution for a broad range of scheme members, if they do not wish to self-select investments. This strategy has been chosen by your employer after taking advice.

The LIP Drawdown is an automatic investment strategy. Your investments will depend on the length of time until you reach your pension age which is assumed to be age 65 (unless you choose a different age). When you are further away from age 65, you will invest in funds with the potential for long-term growth. The value of your savings will fluctuate (increase or decrease) on a daily basis as a result of the performance of the funds used. As you approach age 65, in preparation for taking a pension, the investments in your pension plan are moved into lower risk funds.

Your contributions will be invested in the funds which make up the strategy depending on your time to pension age. The chart below shows how the strategy automatically moves your investments to different funds over time. The movements take place each quarter. No charge is made by Aviva for the quarterly movement of funds, however you may incur buying and selling costs when your investments are switched between funds. As your investments are moved to different funds within the programme, your annual management charge (AMC) may change as well. This is as a result of the



funds used in the investment programme having different levels of charges, with the proportion invested in each of the funds changing as get closer to your pension age.

If you are using the strategy you should think carefully about whether you do expect to draw a regular income from your pension savings while remaining invested at age 65. We recommend that you consider whether the default fund is appropriate for you. You may wish to consider taking financial advice if you are unsure if the default fund is right for you. If you do not have a financial adviser you can find one at www.unbiased.co.uk. You may have to pay for this advice.

You may leave the strategy at any time and make your own investment choice for your pension plan investments and any future contributions you may make.

Please be aware there is no guarantee that LIP Drawdown will benefit your pension fund as the value of the investments may go down as well as up and is not guaranteed. You could get back less than the amount paid in.

Contributions will be invested in the funds which make up LIP Drawdown. This investment programme has been designed to manage your pension investments for the life of your Account.

The chart below shows how the investment programme aims to move your money into specific investment funds. The movements take place on a monthly basis as you approach your selected retirement date.

*Your investment programme end date will be the target date used to determine the mix of investments in your fund. It can be any date, up to and including your selected retirement date.

Targ

et %

inve

sted

in fu

nd

Years to investment programme end30+ 29 28 27 26 25 24 23 22 21 20 19 18 17 16 15 14 13 12 11 10 9 8 7 6 5 4 3 2 1 End*

LIP Drawdown Lifetime investment programme

0102030405060708090

100

Aviva Pension MyM LIP Global Equity FundAviva Pension MyM LIP Diversified Fund

Aviva Pension MyM LIP BondAviva Pension MyM LIP Cash




The percentages invested in each of the funds shown on the previous page, will vary slightly according to financial market movements. Each column can represent one year or a number of years depending on the length of the investment programme. All movements of funds managed by the investment programme are at no extra cost.

As your investments are moved into different funds within the investment programme, your total AMC may change.

Whilst you are invested in this investment programme you are unable to invest in other funds at the same time.

If you wish to leave the investment programme at any time, you must let Aviva know how you wish to invest future contributions.

Please be aware there is no guarantee that this investment programme will benefit the value of your Account when you come to retire. The value of an investment is not guaranteed and can go down as well as up. You could get back less than the amount paid in.

This investment programme may be subject to changes to the funds included in the investment programme or to the timings of the fund movements and their frequency, in accordance with the terms of your Account.

Details about each fund in the investment solution are shown starting on page 13.

Please refer to your Member guide for information on how to log into My Money.

Targ

et %

inve

sted

in fu

nd

Years to investment programme end30+ 29 28 27 26 25 24 23 22 21 20 19 18 17 16 15 14 13 12 11 10 9 8 7 6 5 4 3 2 1 End*

LIP Drawdown Lifetime investment programme

0102030405060708090

100

Aviva Pension MyM LIP Global Equity FundAviva Pension MyM LIP Diversified Fund

Aviva Pension MyM LIP BondAviva Pension MyM LIP Cash



Potential benefits• The investment programme offers

an alternative to having to change your investment funds independently as you head towards your selected retirement date.

• During the period leading up to your selected retirement date, your Account is moved from investments with a greater exposure to the stock market into more cautious investments. This aims to reduce your exposure to risk from stock market fluctuations.

• Your investment programme can be amended if you choose to take your pension savings earlier or later than planned.

• You can choose to leave the investment programme at any time.

Things to consider• There is no guarantee that the investment

programme will prove beneficial to your pension savings.

• The value of your investments, even in lower risk funds, can fall as well as rise and the value of your pension savings is not guaranteed.

• Taking your pension savings earlier or later than planned may have an impact on your investment programme, and may mean that it is no longer suitable for your individual circumstances.

• The default investment programme targets a specific retirement outcome. If you know how you intend to take benefits and the default does not suit your intentions, you may wish to consider the alternative investment programmes, details of which can be found in the Investment fund aims and risk guide https://library.aviva.com/aengs638c.pdf.

Investment programme considerations





The funds you’re invested in The table below shows the funds which make up the default investment solution. It shows each fund’s risk rating, total AMC and additional expenses. Please see the Investment fund aims and risk guide which can be found online at https://library.aviva.com/aengs638c.pdf for more information on the risk ratings, risk warnings and aims.

Risk rating Fund name Fund aimTotal AMC

Additional expenses

6 High volatility

Aviva Pension MyM LIP Global Equity

This fund seeks to achieve a long-term global equity return by investing in one or more passively managed and/or actively managed underlying funds. The underlying funds provide a balance between investment in the UK and in overseas markets, both developed and emerging. The underlying fund(s) are selected and reviewed by the scheme investment advisor. The underlying fund(s) may change. Details of the underlying fund(s) can be found on the fund fact sheet.

Risk warnings A, B, C, D, J

0.25% 0.01%

4 Medium volatility

Aviva Pension MyM LIP Bond

This fund seeks to reduce the impact of changes in interest rates and inflation expectations on the amount of pension income the fund can buy. The fund aims to achieve this by investing in funds that invest in a range of fixed interest and index-linked government bonds and corporate bonds. The underlying fund(s) are selected and reviewed by the scheme investment advisor. The underlying fund(s) may change. Details of the underlying fund(s) can be found on the fund fact sheet. The fund does not provide any guarantee of the level of pension in retirement or the cost of buying that pension.

Risk warnings A, E, J

0.22% 0.00%




Risk rating Fund name Fund aimTotal AMC

Additional expenses

4 Medium volatility

Aviva Pension MyM LIP Diversified

This fund seeks to achieve a positive return over the medium to longer term by investing in one or more actively managed underlying funds. From time to time this fund may invest in passively managed funds on a temporary basis where the scheme investment advisor considers it necessary. The fund invests in a combination of traditional assets (such as equities and bonds) as well as derivatives to give a diversified global portfolio. The underlying fund(s) are selected and reviewed by the scheme investment advisor. The underlying fund(s) may change. Details of the underlying fund(s) can be found on the fund fact sheet.

Risk warnings A, B, C, D, E, F

0.71% 0.04%

1 Lowest volatility

Aviva Pension MyM LIP Cash

This fund seeks to preserve capital value. The fund invests in one or more underlying funds which invest in a range of short-term money market instruments. It is possible that in some circumstances the value of the fund may fall. The underlying fund(s) are selected and reviewed by the scheme investment advisor. The underlying fund(s) may change. Details of the underlying fund(s) can be found on the fund fact sheet.

Risk warnings A, E, G

0.22% 0.00%



Help and further informationFurther informationIf you would like advice, you can find a local independent financial adviser in a number of ways, you may be charged for this service:

• Unbiased at www.unbiased.co.uk• GOV.UK provides impartial UK Government

information on pensions at www.gov.uk/browse/working/workplace-personal-pensions

Please note these sites are not provided by Aviva. Therefore, they may not be regulated by the Financial Conduct Authority.

How to view and manage your AccountThe easiest way to find out more about all of the funds and manage your investments is at:

www.avivamymoney.co.uk

You should review these before making any investment decisions.

As an alternative to the default investment solution, you can invest in other investment programmes.

Details of the additional investment options available to you are detailed in the Investment fund aims and risk guide which can be found online at https://library.aviva.com/aengs638c.pdf

You are also able to invest in self-select funds. These are designed for people who are confident in making investment choices and wish to tailor their investment to suit their individual needs.

If you want to choose your own investments

General questionsYour employer will normally be your first point of contact for general questions. However, if you have a question about investments, please contact Aviva, who administer the scheme on behalf of the Trustees. Their contact details are on the back page.



http://www.gov.uk/browse/working/workplace-personal-pensions

http://www.gov.uk/browse/working/workplace-personal-pensions




TM14013 TEMP_IB_WRA Apr 2019

Call Aviva on 0345 604 9915 on Monday to Friday between 8.00am and 5.30pm. They may record calls to improve their service. Calls may be charged and these charges will vary; please speak to your network provider.

Visit their website at www.avivamymoney.co.uk

Email them at [email protected]

Write to them at Aviva, PO Box 2282, Salisbury, SP2 2HY

These documents are available in other formats.If you would like a Braille, large print or audio version of this document, please contact Aviva.

How to contact Aviva

Aviva Life & Pensions UK Limited.

Registered in England No. 3253947. Registered office: Aviva, Wellington Row, York, YO90 1WR. Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Firm Reference Number 185896.

Telephone 0345 602 9189 – calls may be recorded.

www.aviva.co.uk

My Money is a registered trade mark of the Aviva group.

AENGS638B MM39040 05.19

PTL is a trading style of PTL Governance Limited.

Registered in England and Wales with company number 02952373. Registered Office at 47 Castle Street, Reading, Berkshire RG1 7SR.

A list of the directors of the company is open to inspection at the company’s registered office.

Rebecca Cooke

Anne Hunt

Jonathan Parker



mailto:[email protected]

http://www.aviva.co.uk

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