DC pensions in 2021: investment insights

Barnett Waddingham’s defined contribution (DC) consulting team presented their latest research in the DC space at the Investment Conference 2021.

Reena Tanna, Senior Investment Consultant, discussed the importance of monitoring members’ projected retirement incomes against targets and looked at the PLSA retirement living standards as a potential starting point in thinking about those targets. She also considered how representative member portfolios have fared over 2020 and what reasonable decisions these members might take to realise their respective retirement targets.

Partner and Head of DC Investment Sonia Kataora explored the extent to which inflation-based return objectives for DC accumulation strategies should be recalibrated in light of sustained falls in real yields and how additionally incorporating risk targets within investment strategy design can help improve certainty of outcomes for members. She also looked at how external influences such as consolidation of schemes and climate change could impact the future path of DC investment strategies.