The £82m Baillie Gifford Multi Asset Income Fund has been chosen by Hargreaves Lansdown as an ‘investment pathways’ solution for investors seeking non-advised drawdown.
Investment pathways were introduced by the FCA in 2019 as part of its Retirement Outcomes Review to help non-advised drawdown consumers who struggle to make investment decisions. Non-advised drawdown providers, such as Hargreaves Lansdown, are required to embed four pre-chosen investment ideas – investment pathways – into their drawdown journey.
Investment pathways are intended to benefit the most disengaged consumers entering drawdown and providers can only offer their clients one investment solution per pathway. The Baillie Gifford Multi Asset Income Fund will be the proposition Hargreaves Lansdown offers for option three of the four investment pathways for those “planning to take their money as a long-term income within the next 5 years”.
The Fund aims to produce monthly income, whilst seeking to maintain the value of that income and of capital in line with inflation (UK CPI) over five-year periods. It invests in a range of assets, notably equities, bonds, property and infrastructure. The Fund currently yields 3.3% and will be available as a pathway solution from 27 January 2021.
Jan Oliver, Partner responsible for income strategies, Baillie Gifford, says:
“Six years ago Pension Freedoms removed the need to purchase an annuity at 75, providing increased liberty and choice. Investment pathways provides investors who may be daunted by this choice with assistance by aligning them with a solution suited to their financial goals.
“Through Hargreaves Lansdown’s pathway solution, investors can access the Baillie Gifford Multi Asset Income Fund and benefit from full access to their capital while being able to receive an income that can compare favourably with current annuity rates.”