Choosing how to invest your contributions
With the Telefónica UK Pension Plan (“the Plan”), you can choose how your pension contributions are invested. There are various options to choose from. Some aim to grow your savings while others aim to protect them. The choices you make will depend on your age, appetite for risk and the time and effort you wish to put in to managing your investments. It’s important that you regularly review your investment options to check they reflect your current circumstances.
You can choose an automated ‘Lifestyle’ option or take more control with a ‘Selfstyle’ option. If you don't make a choice your savings will automatically be put into the Lifestyle option called 'Getting ready to purchase an annuity'.
Why choose the Lifestyle option?
Lifestyle requires the least input from you. Your contributions are invested in funds that are selected by the Plan’s Trustee. As your retirement approaches, your savings are gradually switched into funds which offer greater stability.
There are three different Lifestyle options for you to consider:
- Getting ready for income drawdown
- Getting ready to purchase an annuity
- Getting ready to cash out
For any of the lifestyle options, you still have flexibility at retirement as to how you wish to use your retirement savings. For example, you could still buy an annuity even if you choose the ‘Getting ready to cash out’ lifestyle option. However, you should think about how you might want to use your savings at retirement when choosing a lifestyle option.
Why choose the Selfstyle option?
Selfstyle offers you more control, but takes more time and effort for you to manage. This option allows you to invest your savings into nine different fund options. You can invest a proportion of your contributions in any combination of funds, ranging from putting everything into one fund, to putting some of your contributions into all of them. The choice is yours.
How will my retirement savings change in practice?
The value of your retirement savings will vary over time and will depend on both the level of contributions made and the returns of your chosen investment option. To show some examples of how this will appear we have included two member case studies here.
How can I change my investment choice?
*Note that non-employees that are deferred members of the Plan cannot access www.telefonicarewards.com, but can use the ‘switching investments’ form using the link above.