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Investment choices for clients in decumulation
Looking at different strategies based on clients' needs
In retirement, delivering clear, transparent, and value-driven advice is essential to empower clients to safeguard their income and enjoy a secure, fulfilling future. At Canada Life Asset Management, we design products for use in decumulation strategies that aim to preserve capital and provide value through all stages of retirement.
In today’s complex and volatile market environment, a single decumulation strategy often falls short of addressing the myriad risks that can erode retirement savings over time.
Exploring different investment strategies
In our latest guide, we explore different strategies—from constant withdrawal approaches and natural income methods to annuity-based solutions and dynamic bucket-style allocations—and how these can contribute to a diversified decumulation framework.
The need for a multi-strategy approach at retirement
There is a wide variety of investment strategies that can be considered when defining a retirement plan, with varying levels of flexibility, complexity and certainty of income.
The sustainable withdrawal rate Sustainable withdrawal strategies include constant dollar, constant percentage, and floor and ceiling approaches.
The cash buffer Keeping a portion of your retirement portfolio in liquid, cash-like instruments (such as high-yield savings accounts, money market funds, or short-term bond funds.
Natural income Designed to generate a steady stream of income directly from their underlying assets – such as interest from bonds, dividends from equities, rental income from real estate, and sometimes income from alternative assets. They distribute that income on a regular (monthly) basis without the need to sell assets to generate cash, mitigating pound cost ravaging.
Annuity, income and growth Blending an annuity with other investments to create an income/growth portfolio. This can offer the best of both worlds, especially for those clients needing greater certainty of income but still requiring some flexibility.
Pot investing (‘bucket-style’) Pot investing, a ‘bucket‐style’ approach, uses a multi‐fund strategy where each fund has a distinct risk profile. The idea is to split your retirement portfolio into three equal parts – one low risk (say risk profile 3), one moderate (risk profile 5), and one higher risk (risk profile 7).
Each strategy has unique strengths and weaknesses depending on the retiree’s stage and personal circumstances.
By adopting a multi-strategy framework, advisers can tailor retirement income solutions to different phases of the retirement cycle to help ensure a sustainable and secure retirement.
Investment choices for clients in decumulation
In our guide by Andrew Morris, Senior Product Specialist, Canada Life Asset Management, we explore:
- Key decumulation risks: sequencing, longevity, market volatility, and inflation
- Different investment strategies and real-life examples of where each strategy can be applied to enhance client outcomes
- How to build a resilient retirement plan that adapts to market conditions and individual circumstances
- How our solutions can form part of this plan
Considering options for your clients
Our actively managed, globally-diversified multi-asset funds are designed to help advisers and their clients meet their objectives through long-term capital growth and/or income.
WS Canlife Portfolio Funds & WS Canlife Diversified Monthly Income Fund
Actively managed, globally-diversified multi-asset funds designed to help advisers and their clients meet their objectives through long-term capital growth and/or income
WS Canlife Sterling Liquidity Fund
A portfolio of high-quality money market assets with a focus on capital preservation, acting as a vehicle for short-term cash requirements
WS Canlife Global Equity Fund
A core exposure to the global equity market that flexibly blends top-down macro views and bottom-up stock selection
Get in touch
Contact our team for more information.
Important information
The value of investments may fall as well as rise and investors may not get back the amount invested.
This document is issued for information only by Canada Life Asset Management. This document does not constitute a direct offer to anyone, or a solicitation by anyone, to subscribe for shares or buy units in fund(s). Subscription for shares and buying units in the fund(s) must only be made on the basis of the latest Prospectus and the Key Investor Information Document (KIID) available at https://www.canadalifeassetmanagement.co.uk/
The WS Sterling Liquidity Fund is a UCITS scheme and a standard variable net asset value (VNAV) money market fund (MMF). The MMF is not a guaranteed investment, nor does it receive external support to guarantee its liquidity. Unlike bank deposits, investment in MMFs can fluctuate and investors’ capital is at risk.