What is Glidepath

A ‘glidepath’ (or lifestyling) is an investment approach where your pension pot is automatically moved into less risky investments as you get closer to retirement.

Our current lifestyling approach, known as Automatic Fund Selector does this, but Glidepath will do it in a different way.

Glidepath will put your money into more diverse investments across the world. And it is designed to reflect the flexibility that now exists when it is time to take your pension.

Of course, your pension is still simple and straightforward. It’s just changing with the times. And changing for the better.

How does it work?

When you open your pension, and until you are 50, all your money will be invested in our new Virgin Money Pension Growth Fund 3.

When you turn 51, your money will then gradually be moved into our new lower-risk Virgin Money Pension Defensive Fund. This will happen automatically every year till you turn 65. And even then, we’ll keep some money in our new Growth Fund 3 so your pension has the potential to grow to support you in retirement.

No matter what age you are or what fund your money’s in, we’ll make sure it’s invested in lots of different types of investments, including UK and overseas shares, listed property companies, and corporate and government bonds.

This will help you ‘spread’ your risk – and means you’ll never have all your eggs in one basket.

Check out how Glidepath works using the handy table below to see exactly where your money will be invested at different ages.

FundUp to 505152535455565758596061626364From 65
Growth Fund 3100%97%94%91%88%85%81%77%73%69%65%60%55%50%43%36%
Defensive Fund0%3%6%9%12%15%19%23%27%31%35%40%45%50%57%64%

What does this mean for you?

Well, it depends on how you set up your pension with us and where you are on your investment journey

What happens when you retire?

Thanks to changes in pension regulations, these days you’ve more choices about how and when you access your pension.

As well as being able to take a 25% tax-free lump sum, you can:

  • Take it in smaller amounts over time (25% of each withdrawal is tax-free)
  • Turn it into a regular income through ‘income drawdown’ or take a cash lump sum
  • Turn it into a regular income by buying an annuity that pays a guaranteed income for life

We’ve designed our new Glidepath to support income drawdown. This means it manages your investments in line with your age and lifestage, rather than the date you think you might retire. It gives you more flexibility on when and how you retire.

At the moment our pension enables you to take your savings as a single lump payment. If you're retiring soon, this could mean that you may need to transfer your pension elsewhere if we don't have all these choices available by that time. We're working hard on making the other choices available in the future.

You can find out more information about retirement options at unbiased.co.uk

Remember, tax treatment depends on individual circumstances. Tax law and practice can change in the future and may affect your pension.

Where will your money be invested?

Our two new funds, Virgin Money Pension Growth Fund 3 and the Virgin Money Pension Defensive Fund, are ‘multi-asset funds’. That means the funds will invest in different types of investments across the world, including UK and overseas shares, listed property companies, and corporate and government bonds.

You can see how these funds are invested below. And, if there are any terms you find confusing, please check out our jargon buster.

Virgin Money Pension Growth Fund 3

We’ll aim to grow your money over the longer term (five years or more) by investing in shares, property bonds, gilts and cash from around the world.

At least 80% of your money is in funds with higher potential returns but with a higher level of risk (like shares).

The rest of your money is in funds with lower potential returns but with a lower level of risk (including various types of lower risk bonds).





Pie to show split of Growth fund

We'll invest:

  • 78% Developed market shares
  • 6%  Emerging market shares
  • 5%  Global property shares
  • 5%  Global high yield bonds
  • 4%  Emerging market bonds
  • 2%  Cash

Expected allocation from November. Funds are not currently live, but we’re in the process of setting up the funds at the moment. Fund allocation may change.

Virgin Money Pension Defensive Fund

Aims to grow your money over the medium term (3 years or more) while protecting your money from ups and downs by investing mainly in assets considered to be lower risk or ‘defensive’.

At least 75% of your money is in funds with a lower risk and return profile (including various types of lower risk bonds).

The rest of your money is in funds with higher potential returns but with a higher level of risk (like shares).





Pie to show split of Defensive fund

We'll invest:

  • 45% Short duration corporate bonds
  • 15% Corporate bonds
  • 13% UK Government bonds (Gilts)
  • 12% Global shares (including property)
  • 6%  Global inflation linked bonds
  • 5%  Cash
  • 4%  High yield / emerging market bonds

Expected allocation from November. Funds are not currently live, but we’re in the process of setting up the funds at the moment. Fund allocation may change.

How does Glidepath compare to our current approach

Our pensions have always been simple and straightforward. And that’ll never change.

But some things are changing. So we’ve created this handy table to help you work out the difference.


FeatureExisting:
Automatic Fund Selector
New:
Glidepath
Designed forPeople who want to buy an annuity to provide a secure income for their retirement (or to cash-in their pension pot completely)People who want to keep some or all of their pension pot invested and use income drawdown during retirement
Less suitable forPeople who want to take their money bit-by-bit during retirementPeople who want to take all of their money on a fixed day – as cash or to buy an annuity
Invests inVirgin Pension Growth Fund and Virgin Money Pension Bond and Gilt FundVirgin Money Pension Growth Fund 3 and Virgin Money Pension Defensive Fund
Which arePassive tracker funds that track either UK equities or bondsMulti-asset funds that invest globally in a mix of different investments, with the mix regularly reviewed on your behalf
Where is it invested?Limited to the UK market onlyRisk is spread more broadly across many countries including developed markets (such as UK, USA and Japan)and emerging markets (such as China, India and Russia)
Asset typesShares, government bonds (gilts) and corporate bondsShares, government bonds (gilts), corporate bonds, listed property companies and cash.
We move your money to prepare for your retirementDuring the 10 years leading up to your chosen retirement dateDuring the 15 years from age 51 to age 65
How we invest your moneyInitially all your money is invested in the Virgin Pension Growth Fund.
Once a year during the 10 years leading up to your chosen retirement date we move 10% of your money to the Virgin Money Pension Bond and Gilt Fund.
So by the time you’re one year from retirement, all your money is invested in that fund.
Initially all your money is invested in the Virgin Money Pension Growth Fund 3.
Once a year, from age 51 until age 65 we automatically move some of it to the Virgin Money Pension Defensive Fund.
From 65 onwards, you’ll have 36% of your money invested in the Growth Fund 3 and 64% invested in the Defensive Fund.
Our charges are0.60% ongoing annual charge for each underlying fund0.85% ongoing annual charge for the Virgin Money Growth Fund 3 and 0.70% ongoing annual charge for the Virgin Money Defensive Fund
Charges for our auto-enrolment customers may vary. Please see the FAQs for more information
How our charges are paidBy adjustment to the unit price of the funds – we do not collect any charges directly from youBy adjustment to the unit price of the funds – we do not collect any charges directly from you
Can I switch this on and offYes – you can switch AFS on or off at any time.
If you switch it on we’ll check your investments and, if appropriate, change them on the last working day of that month.
If you switch it off your funds will stay as they are and you’ll need to tell us if you want to make changes to them.
Yes – you can switch Glidepath on or off at any time.
If you switch it on we’ll check your investments and, if appropriate, change them on the last working day of that month.
If you switch it off your funds will stay as they are, and you’ll need to tell us if you want to make changes to them.

Check you’re on the right track

We believe it’s always important to carefully consider your future financial security.

Whatever your retirement plans are, check out the Money Advice Service pensions calculator to help you find out if you're on the right track for retirement.