A single, simple solution for DC savers
What are target date funds?
Target date funds enable DC members to save into a single investment fund, based on their estimated retirement date. The assets in which they invest change over time, reflecting the stage members are at in their retirement journey.
Each target date fund has a range of target dates, so for example, a member born in 1985, who wanted to retire between the ages of 60 and 65 would be in the L&G Target Date Fund 2040-2045.
Reasons to invest
A flexible DC investment strategy designed with an aim to evolve with members’ changing needs
Professionally managed investment strategies where members’ needs are prioritised, using our unique insight into behaviours and markets.
Extended growth period and exposure to a diverse range of growth assets
Growth period takes the member up to 10 years before retirement, with a small exposure to private markets aimed at aiding diversification* and growth.
An emphasis on investing responsibly to make real world impact
We aim to invest members' money responsibly, in line with our purpose of creating a better future through responsible investing.**
What’s under the bonnet?
The asset allocation changes up to and through retirement years, focusing on growth in the early years, and de-risking gradually from 10 years before retirement and beyond.
Chart shows illustrative asset allocation for L&G TDF 2065-70 (Default). Asset allocation is subject to change. Chart shows numbers which may have been rounded and so some of the totals may not add up exactly to 100.
Source – LGIM June 2024
L&G Target Date Fund Range
How might the L&G Target Date Funds benefit DC scheme members?
Using unique insights to act in members’ best interests
We leverage our unique insights to evolve the funds so that we always aim to act in the best interests of clients. We call this ‘generational intelligence’.
100% of funds in the growth phase consider ESG factors [1]
Enables members to see a clear correlation between their investments and improving the future.
Access to a wider range of opportunities
Ranging from sustainable investments in high growth sectors to a small allocation to private markets.
1. Applies to L&G DC Workplace scheme members currently invested in the growth phase of all L&G Target Date Fund strategies. Subject to change. ESG integration and consideration through a variety of factors.
Investing responsibly for our members
We consider responsible investment as a financially material risk and it is therefore integrated into our overall approach to investment. As part of this, we have integrated the following approaches for various parts of the portfolio.
Engagement
LGIM engages with companies, regulators, policymakers, industry peers and other stakeholders to tackle important issues which have the potential to affect us all.
Exclusions
LGIM can divest from particular companies or issuers if they don’t meet certain sustainable thresholds, e.g. those on LGIM’s Climate Impact Pledge, Future World Protection List or Policy on Coal. This is implemented as appropriate across the fund.
Enhancements
LGIM can amplify the sustainable credentials of a portfolio by investing more in those companies that score more highly from a sustainability perspective. We engage with the underlying fund managers to encourage them to invest in this way.
L&G Lifetime Advantage Funds
Aiming to improve member outcomes by creating a better future for them and the world
Get in touch
Get in touch
If you would like any further information please complete the contact us form.
Key Risks
The value of any investment and any income taken from it is not guaranteed and can go down as well as up, and investors may get back less than the amount originally invested. *It should be noted that diversification is no guarantee against a loss in a declining market. Assumptions, opinions and estimates are provided for illustrative purposes only. There is no guarantee that any forecasts made will come to pass. The risks associated with each fund or investment strategy should be read and understood before making any investment decisions. Further information on the risks of investing is available from LGIM’s Fund Centres.
** By 30 June 2024, we managed £381.2 billion in responsible investment strategies. As at 30 June 2024. AUM in responsible investment strategies represents only the AUM from funds or client mandates that feature a deliberate and positive expression of ESG criteria, in the fund documentation for pooled fund structures or in a client’s Investment Management Agreement. Mandates which only invest in government bonds are not included, however where LGIM manages a mandate (for a third-party client) which is invested in a broad asset exposure that includes, but is not limited to, government bonds, these mandates would be included subject to that mandate having a deliberate and positive expression of ESG criteria.
Whilst LGIM can integrate Environmental, Social, and Governance (ESG) considerations into its investment decision-making for part of the fund, and stewardship practices, this does not guarantee the achievement of responsible investing goals within the portfolio.