State Street Global Advisors has launched a post-retirement fund designed to meet the growth in drawdown following the pension freedoms.
The Timewise Target Retirement Choice Fund has been designed to suit members who plan to drawdown income steadily, make ad hoc cash withdrawals, purchase an annuity or a combination.
The asset manager says the fund is diversified across developed and emerging market equities, fixed income and alternative assets.
It uses “proprietary risk controls” to control volatility and address the issue of sequencing risk which can see pots emptied too quickly.
The fund is the latest addition to the Timewise Target Retirement Funds, State Street’s range of workplace pension funds.
State Street head of defined contribution Nigel Aston says: “Following the pension freedom reforms, we thoroughly researched the attitudes of members in both the saving and pay-out phases.
“What became very apparent was the desire for a default option in retirement that allowed people to keep their options open and that inspired investment confidence.”
He says: “Retirement can be unpredictable and default funds need to be more intuitive by providing a broadly appropriate level of risk for members based on their stage of life – rather than targeting a specific outcome, be it cash, annuity or drawdown on a particular date.”