Oct 05 2022
On 1 July 2022 Lifetime Asset Management took over the responsibility for the Aon Master Trust, renaming the Trust, the Lifetime Master Trust.
Lifetime is thrilled by the opportunity to partner with you and excited by the future.
Ralph Stewart, Managing Director of Lifetime Asset Management and Chairperson of the Investment Committee explains what employers and employees can expect from Lifetime.
A Different Approach
Under the new approach, employers and employees have a specialist workplace insurer broker (Aon) and a retirement investment specialist (Lifetime) working together to deliver world-class employee benefits.
Aon is a global insurance broking and risk management business. The Master Trust reflected Aon’s proven skills in providing insurance solutions and consulting services required to support the management of a Master Trust. Aon is not an investment manager.
Lifetime is an investment manager specialising in retirement savings and retirement income. Aon has been retained to continue to provide insurance broking services to the Lifetime Master Trust while Lifetime focuses on providing high-caliber investment management for your retirement savings.
The Lifetime Approach
The Lifetime approach is retirement focused, whether you are saving for retirement or spending in retirement. The Lifetime team understand that the investment strategies required are unique and are passionate about supporting people into a better retirement through well managed investment strategies.
Lifetime’s team and its investment committee have decades of experience in the Funds Management industry. A New Zealand owned and operated company, Lifetime specialise in retirement savings and regular retirement income payments. Today Lifetime currently manages close to $500 million of retirement focused investments, and this will rise to nearly $1 billion within 12 months, with further retirement savings entrusted to the team.
Investing for a better retirement
Lifetime do not believe offering a wide range of investment options maximizes investment performance. A smaller number of investment options, managed with conviction, will produce better results.
When Lifetime took over the management of the Master Trust it included all 24 Funds which Aon offered. We have quickly found that of the 24 Funds, 70% of the members preferred three Funds, with 30% spread across the remaining 21 Funds.
This has seen Lifetime kick off a review of all the Funds within the Master Trust by leading experts Eriksens Global, a restructure of the funds would result in a new smaller range of actively managed funds at lower cost. Lifetime hopes to bring a proposal for consultation before the end of the calendar year.
Refreshed Fund Options would be managed by Lifetime and use a combination of active asset allocation and passive asset management. What does this mean? The biggest single contributor to investment performance is asset allocation, which is the selection and ongoing management of investment assets. For example, determining how many shares to hold, how many bonds to hold, how much to hold in New Zealand how much to hold outside of New Zealand, how much currency exposure to hold and most importantly how much risk to take.
These decisions are taken through the Lifetime strategy are constantly monitored by the Lifetime Investment Committee comprising economists (Cameron Bagrie), investment strategist’s (Kevin Stiratt), investment analysts (Paul Robertshaw), Valuation experts (James Beale), actuary (Charles Hett), global retirement investment specialists (Milliman Inc) and accounting and reporting professionals (Ellen Cheyne).
Investing to spend in retirement
When providing an income in retirement our challenge is to give our investors the comfort that their retirement savings will last their lifetime.
The buzz word to describe drawing down retirement saving to generate an income in retirement is called decumulation. We believe managing savings to generate an income in retirement and managing retirement capital to generate a retirement income for life are fundamentally different.
To do this our investment strategy is a function of calculating an individual annuity factor for each of our investors. We combine the following factors to calculate a level of income that is sustainable for a lifetime.
- Age
- Gender
- Tax rates
- Expected investment returns
- Expected investment volatility
- Current mortality
- Future mortality
- Individual circumstances (Health)
We then constantly monitor the income levels to ensure the capital will sustain a lifetime of regular income.
Check out the Lifetime Retirement Income Projection Tool, and discover what your retirement savings could generate in an income designed for life.
