Legal & General Investment Management has launched an income fund for investors planning for retirement.
The Real Income Builder fund is targeted towards pension investors, as well as other retail investors and private wealth clients, and is described as a medium capital risk product by the group.
The fund invests in large caps and investment grade bonds and aims to generate inflation plus 4 per cent annually in three-year rolling periods with income reinvested. When income is withdrawn from the fund, for example during retirement, the fund’s aim is to grow income in line with inflation.
Managed by Lance Phillips, head of active equity at LGIM, and his team, the fund soft launched in December 2014 and was seeded with £500m of internal money from L&G.
Phillips says: “We are delighted that Real Income Builder has delivered strong income and capital performance over the last 12 months. In addition, we think the clarity that Real Income Builder provides about retirement income potential will be a major help to individuals and advisers in making better planning decisions.”
Simon Hynes, head of UK retail sales at LGIM, adds: “Real Income Builder’s investment objectives and approach are well positioned to address the needs of our clients. It brings much needed innovation to the table as the shift towards more outcome-focused investment solutions continues.”