AVC investment options

With effect from 1 April 2020, AVCs will be invested with Legal & General, no further AVCs will be paid to Standard Life.  AVCs that are currently invested with Standard Life will be transferred to Legal & General during 2020.  Details of the funds available with each provider are listed below:

If you are considering early retirement you may wish to review your investment choices with a view to the possibility of switching your investments to a lower risk fund in the months before retirement to reduce the risk of capital loss.

Legal & General

L&G World (ex UK) Equity Index Fund

Invests in:

Shares of overseas companies

Fund management:

Passive

Fund aim:

To track the performance of the FTSE World (excluding UK) Index (including re-invested income) to within +/- 0.50% each year for two years out of three.

L&G UK Equity Index Fund

Invests in:

Shares of UK companies

Fund management:

Passive

Fund aim:

To track the performance of the FTSE All-Share Index (including re-invested income) to within +/- 0.25% each year for two years out of three.

L&G All World Equity Index Fund

Invests in:

Shares of UK and overseas companies

Fund management:

Passive

Fund aim:

This Fund is invested wholly or predominately in ordinary shares that are constituents of the FTSE All-World Index. The objective of the Fund is to hold a portfolio of developed and emerging market securities designed to match the return of the index within a specified tolerance.

L&G Ethical Global Equity Index Fund

Invests in:

Shares of UK and overseas companies demonstrating strong environmental, social and governance practices

Fund management:

Passive

Fund aim:

To track the performance of the FTSE4Good Global Equity Index (including re-invested income) to within +/- 0.5% each year for two years out of three.

L&G All Stocks Index Linked Gilts Index Fund

Invests in:

Government bonds issued with a long-term repayment period

Fund management:

Passive

Fund aim:

To track the performance of the FTSE A Index-Linked (All Stocks) Index (including re-invested income) to within +/- 0.25% each year for two years out of three.

L&G Diversified Fund

Invests in:

A wide variety of investments including company shares, Government and corporate bonds, private equity, property, currency and commodities

Fund management:

Passive (some Active)

Fund aim:

To provide long-term investment growth through exposure to a diversified range of asset classes.

L&G Pre-Retirement Fund

Invests in:

Government and corporate bonds issued both in the UK and overseas

Fund Management:

Passive

Fund aim:

To provide diversified exposure to assets that reflect the broad characteristics of investments underlying a typical traditional level annuity product.

L&G Future World Fund

Invests in:

Shares of UK and overseas companies which exhibit characteristics that have historically led to higher returns or lower risk than the market as a whole and are less carbon-intensive and earn green revenues

Fund management:

Passive

Fund aim:

To replicate the performance of the Index (the FTSE All-World ex CW Climate Balanced Factor Index) and will ensure the Fund has similar characteristics as the Index whilst not necessarily holding all the constituents of the Index. The anticipated annual tracking error, in normal market conditions, relative to the Index is +/-0.60% in two years out of three.

L&G Cash Fund

Invests in:

Short term money markets investments such as bank deposits and Treasury bills

Fund management:

Active

Fund aim:

To provide capital protection with growth at short term interest rates. The fund invests in the short-term money markets such as bank deposits and Treasury Bills.

Transport for London 2020 Lifestyle Fund

Initially, your pension savings will be invested in a fund that invests in equities (the L&G All World Equity Index Fund). In return for targeting a higher level of investment growth over the longer term, you accept that the value of your pension savings may go up or down quite sharply, and more often, compared to some other lower risk asset classes.
 

When you are 20 years from your retirement date, Legal & General will automatically start to gradually move your AVC pension savings so that, by the time you are 10 years from your retirement date, 100% of your fund will be invested in a diversified fund (the L&G Diversified Fund) that aims to reduce exposure to investment risk by investing in a range of different  assets whilst also aiming to provide investment growth over the long term.
 

When you are five years from your retirement date, Legal & General will begin to move your AVC pension pot so that, when you reach your retirement date, 100% will be invested in a lower-risk fund that invests in short-term cash deposits (the L&G Cash Fund). Instead of aiming for higher investment growth, this fund aims to reduce the impact of any sudden falls in the value of your AVC pension pot, as you approach retirement.

All the changes are automatic - you do not need to fill in any forms.

Standard Life

Standard Life - Annuity Targeting Pension Fund

This fund has a very different aim from most other investment-linked funds. It is designed for investors approaching retirement and considering annuity purchase. It aims to reduce the effect of changes in long term interest rates on the value of pension income the fund can purchase. Long term interest rates are one of the main factors affecting the cost of an annuity. The fund invests predominately in bonds whose prices are normally expected to rise and fall broadly in line with the cost of purchasing pension income. The fund does not provide any guarantees in relation to the level of pension income you will be able to purchase at retirement. It also does not protect against changes in the cost of purchasing an annuity that arise due to changes in life expectancy.

Please note that this fund may not be suitable for everyone, for example it may not be suitable for a customer who is not considering annuity purchase or for those who intend to buy a pension that increases each year at a rate linked with inflation.

Standard Life - Deposit and Treasury Fund

The fund aims to provide a return before charges equivalent to overnight deposits by investing in deposits and short term money market instruments.

The fund price is not guaranteed by Standard Life and there could be circumstances where the fund price may fall. A fall might happen if, for example, there is a default by one of the banks where some of the money held or where there is an adverse market movement in the value of some if the money market instruments held. A fall may also happen if interest income falls so low as to be less than the charges applied to the fund.

Standard Life - Passive Plus III Pension Fund

The fund aims to provide long term growth while being managed to a level of risk, rather than a level of return. This fund is risk level III and as such invests in both lower risk investments such as money market instruments and certain types of bonds, and higher risk investments such as equities and property. This may suit you if you have a balanced attitude to risk. The investments in the fund can be from around the world. The fund can also invest in absolute return funds that aim to provide positive investment returns regardless of the market.

Standard Life - Ethical Pension Fund

The fund aims to provide long term growth by investing in a diversified portfolio of assets (including equities and corporate bonds) that meet Standard Life's strict ethical criteria. The fund's assets can be from both the UK and overseas and are predominately equity based. The ethical criteria are agreed with the Standard Life Ethical Committee and may be amended from time to time if considered appropriate. The fund manager will exclude companies which fail to meet the ethical criteria while seeking to include companies whose business activities are regarded as making a positive contribution to society. 

Standard Life - International Pension Fund

The fund aims to provide long term growth and is designed for investors who are looking for exposure to global equity markets. The fund invests predominately in the shares of companies listed on the Global stock markets and is actively managed by Standard Life's investment team, who will select stocks to try to take advantage of opportunities they have identified. 

Standard Life - Vanguard FTSE UK All Share Index Pension Fund

The fund aims to provide long term growth and is designed for investors who are looking for exposure to global equity markets. The fund invests predominately in the shares of companies listed on the Global stock markets and is actively managed by Standard Life's investment team, who will select stocks to try to take advantage of opportunities they have identified. 

Standard Life - iShares Index Linked Gilt Index Pension Fund

The objective of the fund is to invest in UK Government Index-linked securities (index-linked gilts) that have a maturity period of 5 years or longer. It aims to achieve a return consistent to the FTSE UK Gilts Index-Linked Over 5 Years Index, which is widely regarded as the benchmark for UK pension fund investment in the longer dated end of the UK index-linked gilt market. 

Standard Life - BlackRock ACS World ex UK Equity Tracker Pension Fund

The fund aims to invest in the shares of overseas companies (Europe, Japan, Far East, US and Canadian markets) according to market capitalisation weightings. Within each of those markets, the fund aims to generate returns consistent with those of each country's primary share market. This fund aims to achieve a return in line with the FTSE All-World Developed ex-UK Index. 

HSBC Islamic Global Equity Index Fund

The fund aims to create long-term appreciation of capital through investment in a well diversified portfolio of equities listed worldwide in a manner that is consistent with the principles of the Shariah. 

Transport for London 2016 Lifestyle Fund

  • Under this approach, contributions are invested in equities in the early years to maximise investment returns
  • As you approach retirement, your AVCs are gradually switched into the Deposit & Treasury Fund to protect their value against stock market fluctuations
  • All the changes are automatic - you do not need to fill in any forms

Changing your investments

If you wish to change your AVC amount please contact the Fund Office or complete and return the AVC change form below. You can change your AVC amount at any time.

The links below will take you to the TfL Pension Fund's past AVC providers' websites.

Clerical Medical
Equitable Life
Standard Life

Please note that all are closed to future contributions.